It has 86 chain stores in 24 cities in China and also it has two chain stores in foreign country which are Singapore and United States. In addition, the company has worked in Sichuan ,Shanxi and Henan provinces was awarded “Advanced Enterprise”, “Customer satisfaction”, “Famous hot pot” and dozens of titles and honors, and innovative characteristic service won the “five star” hot beauty shop name. The industry life-cycle of Haidilao is growth stage and it has strong increase in sale. The whole industry of catering is small scale and the market concentration is still low in China.
The difference among the competitors is bvious and the competition is quite intense and fierce. The development of catering industry is slow and rough thanks to high cost of material, rental and labor as well as changed policy. Differentiation Strategy Although Haidilao is a hot pot, it is not the core business of food, but service and also it is their feature Of business. Their core value is ‘Service paramount, Customer highest”, they fully devote themselves into serving the customer, try their best to satisfy the customers and put customers in the first place.
They adopt a service differentiation strategy which is unique and quite ifferent with other competitors. Brand image Haidilao have a good brand image sine Haidilao have did a little bit better than other companies. As we know, customers usually choose a restaurant thanks to five aspects which are price, taste, environment, location and service. Haidilao did a little bit better than other restaurants. First, the price of consuming is reasonTABLE for customers. In term of among the restaurants those provide the same level service, the price is the cheapest one.
In term Of among the restaurants that has the same price level; it provides a best service in the industries. Second, it provides a various tastes to suit different customers since some customers cannot be used to Sichuan Hotpot that is quite spicy and hot. Third, the location is ascendant and superior. It usually chooses the most convenient place for customers to come. Forth, the environment is gorgeous and spacious, which make people feel comforTABLE. The last one which is most important factor that is service and Haidilao is famous for its excellent service.
Customer Service The service of Haidilao really distinguishes themselves with others and provides unique service for the customers so that it really attracts a great umber of customers. Haidilao will service what customers really want to get and try their best to satisfy the customers need. Everything they do is to make the customers feel more comforTABLE and homelike. Diverse service From the moment customer come, the staffs of Hadilao start to service you. If you drive your own car, they will help you parking your car and providing a clean car service for free in the weekdays.
After you entering the store, they may inquire you whether you have booked a TABLE and lead you to the waiting places. When you are waiting, they will provide you free water, fruits, and nack as well as they will play chess with you when you feel bored. Therefore, it will reduce the waiting time and customer can feel not too long for waiting. In addition, it provides a kid play room for child so that the patents do not need to spend a lot of time on taking care child. Even in the washroom, it also provides services for the customers, including opening the faucet, squeezing liquid soap and hand giving you towel paper etc.
Also, customers also can enjoy a nail service and shoeshine service. When you about to order, they will remind you they have half dishes while you are eating. They will give you a mobile bay and apron to keep the phone and you clean. “Abnormal” service The staffs will try his best to satisfy the customers. They quietly care what your think and feel as well as keep a watchful eye on you. Even just your casual speaking or one action, they probably take it as a significant problem and help the customers to solve it. For example, a staff provided ginger decoction immediately for the customer when the customers have sneezed.
A typical example is that a staff helps the customer for game Leveling in order to let customer can enjoy his dinner. Another typical example is one customer chatted with her friend and she just mentions causally that she want to eat lianggao. The staff immediately takes a taxi to lianggao store which is far away from the store and went back quickly in order to satisfy the customer need. Actually, we cannot see this kind of service happen in any other restaurants. It really provides a unique service for the customers and differentiate themselves with other competitors.
Features and innovation InimiTABLE The service of Haidilao is inimiTABLE. Maybe the competitions can copy what they provide the service for customers. For example, providing a clean car service, providing you free water, fruits, and snack as well as they play chess etc. However, competitors cannot copy their enterprise culture. Since most of the enterprise management are outside in control way, but Haidilao is opposite with most of the enterprise, Haidilao is inside out in control way. Other companies High Authorization They provide personalized service and they give employees high authorization.
All of the staffs are “manager” thanks to the staffs can have right to give customers fee exemption and give more foods or change and add a new food for free. For example, when they think that they do not service you well, they probably will give you free foods for recovering their servlce. Innovation of Service Also they do not have a standard system to force what should the staffs do. They let the staffs keep their own thinking or creative Idea and follow their own idea to service the customers instead of other competitor have a standard system to force them to service the customers.
For example, one customer’s baby has slept and the mother should take care of her baby so that it is hard for the mother to enjoy the dinner. However, one staff saw that nd found a crib in order to satisfy the mother’s need. Therefore, it will satisfy what customers really want to get and this idea and behavior cannot really copy by competitors since it was generated by the staffs instead of the standard system. Mentoring The studying process of staffs is mentoring. It means that the Old staffs will teach new staffs and affected their behavior. What the behaviors of staffs perform is affected by the store managers.
Also the behavior of store managers are influenced by the small regional manager and the behavior of small regional managers are influenced by the large managers etc. Finally, the behaviors of high level managers are affected by the CEO, ZhuangYong. Active Employees Most of staffs are from the countryside and they are more active to provide service for the customers than other servants in restaurant since Haidilao provide a good welfare for them and training them as well as teach them useful skills. Also the corporate ladder is they have a good opportunity to get a high position since most of manager’s diploma below the high school diploma. Value Chain Analysis – primary activities Inbound logistic Haidilao’s four large logistics and distribution bases were set up in Beijing Shanghai, Xi’an and Zhengzhou, with “procurement scale, mechanized production, warehousing standardization, distribution modernization” for the purpose of forming as a set of procurement, processing, warehousing, distribution as one of integration of large logistics supply system. The raw material base of Haidilao is located in Chengdu, its products have passed the HACCP certification, QS certification and ISO international quality management system certification.
Operations The processing and production equipment are achieved by a mechanization, automation and standardization pipeline. It includes efficient automated packaging, automated material selection, various mechanized loading and unloading and additions of store automation and standardization equipment. Marketing & sales Haidilao create the brand reputation through their special service features, to achieve the World-of-mouth effect, also they putting up posters, intruding nutrition information of their food in ordering to acquire consumers confidence.
In addition, Haidilao is actively to develop a variety of new dishes and seasonal cuisine and provide an on-line ordering and hotpot delivery Su pportive activites Procurement Hadilao owns their hotpot ingredients base and lamb plant, also they have multiple suppliers and farms. Since the procure scale is large enough, the entire process trend to be integration. All the vegeTABLE of Haidilao is directly procure form farmers. Farmers will be sent the material directly to the company after they picked from the vegeTABLE garden and no middlemen involved in, thus reducing the vegeTABLE retention period to keep freshness.
Moreover, they follow a set of rigorous testing process to ensure the quality of the hotpot ingredients. Technology development Hadilao quality control staff will test each of vegeTABLEs through the pesticide residues detect, only qualified raw material is accepTABLE. These steps guarantee food quality at the source. In the cleaning and processing sector, the vegeTABLE processing plants need to control in 6-8 degrees Celsius. In the product distribution and storage sector, all the process must be maintained 0-4 degrees Celsius, so there are strict temperature control and equipment requirements for delivery’ vehicles.
At the same time, Haidilao also established a safety traceability system to effectively monitor the entire raw aterials production, distribution and serve process. All stores also dedicated 48 hours retention system. If there happen food safety problems, Haidilao can respond it at the first time. Human resource management Haidilao divide their human resource management into 5 parts, including basic regulations of human resource system, promoting system, training staff, evaluation of staff performance and monitoring staff.
Also, the company provides a good welfare system. For example, Staffs have 4 official days per month, working nine hours a day, a house with bath equipment shared by our people, and there are aunt help them to clean the room on time, etc. Because of this special treatment and the clearly promotion opportunities, staffs not only work hard, but also makes other company difficult to poach their staffs. General administration The leader Zhang Yong advocate family-style management in Haidilao, he thinks that staffs are family members.
In his opinion, business management is similar to the family management. What the enterprise managed is staff, and only seems the staff as a part of the family can make employees have a sense of belonging heart and willing to join the family. General Environment Analysis Political/legal segment In recent years, food security problem is becoming an important social problem. Food security problem emerge in endless urge government to enact a series of legal measures. Hop Pot is also will be regulated by laws and regulation about food security because it is part of food industry.
For example, “food safety law’, “Catering services food inspection institution management specification” and so on which are strengthen the management of catering service and food inspection Economic segment In 2011, although China’s economic development exist some problems, it also eep a rapid development speed. In the first three quarters of 201 1, the average income of urban households is 17,886 Yuan. With the development of economic and the increase of living standard, people’s food consumption ideas have gradually changed. People like to have a dinner in the outside and become more rational.
The requirement of consumption quality is increasing constantly and people more likely to pursuit brand quality, taste characteristics, health, nutrition, safety and convenience. Catering industry is promoted by the national economic growth, however, the inflation lead the operating cost increase. The serious inflation causes a general rise in the price of rice, vegeTABLEs and other agricultural products. And it also weakened purchasing power of consumers. In the future, the inflation will continue influence the industry related to agricultural products. Therefore, HAI DILAO will also be influenced by the inflation.
Demographic The population distribution and flow With the accelerating industrialization and urbanization, more and more workers inflow to cities, which reduce the aging of population and bring the power to the production and consumption. Sociocultural Segment Family Structure Because of the change of China’s family structure, most families with three people are becoming the major consumption. And individual pay food consumption has become the mainstream of China’s catering market. Nowadays, the consumption subject with two to four people has higher consumption ability.
So, it is the development direction of China food consumption in the future. Cultural Education With the gradually improvement of people’s educational level and quality, the service quality of catering industries will increase. This will promote the catering industries grow steadily in the future. Life Style The pace of life in modern society is increasingly accelerated, more and more people like to go out with a dinner rather than spend much time on preparing them at home. Therefore, more and more families and individual choose to have the dinner outside to meet their purpose of communicating feelings.
Professional Women With the development Of economic cause more and more women in the workforce. Works take up their spare time and the increasing household income lead families have the dinner in the outside. Greater Concern For Healthy Diets And Physical Nowadays, people are more concern for their health and like a slim figure. So, green food has become an important trend and catering industry should transform their way to attract more consumers Technological segment Nowadays, catering industry also be influenced by the constantly updated technology.
In order to speed up the pace of catering modernization, China cuisine association combined the electronic procurement management system, which from Japan, with China’s market characteristics to exploit the new system named CAI GOU Yl This new system help firms enter into the modern procurement management system quickly and build the reliTABLE supply channels. Firms can improve the management and reduce the cost, then improve their profit margins and food safety effectively. So, modern science and technology is applied to the catering industry and will promoting it develop rapidly.
Global segment Globalization is a big trend, every successful company all want to take advantage this chance. It is easy for company to enter new foreign markets to attain big profit and enjoy some benefit. But it is also a big challenge, many foreign company enter into China market and compete with local enterprise. Because foreign companies more mphasize on high quality services, which is a big challenge for China local firms. Motivation Of Entering IJS Marketing – Motivation HaiDiLao has successfully launched over 60 stores within China and one store in Singapore, now it starts to enter into U.
S. market. As we can see, the new branch in Singapore was not operating very well, so why it still want to try another risk in a totally new market. There is some analysis about what motivation that let HaiDiLao had this aggressive action. understanding the market According to the CEO of HaiDiLao, Zhang Yong’s words, we are not looking for uick expansion and there will not be a large-scale comprehensive action about overseas expansion, what we expected was to understand the market deeply.
As you can see, it only has one branch in Singapore and America, these shows that their aim is to collect the useful information for future development, not on gaining profit. After all, the way to conduct business and culture are totally different in different regions, so knowing the market is an important factor to successes. Expand market share and gain reputation A lot of firms use market share as a managerial goal, because it can be an ffective objective. It enhances small business owners to focus on the overall market and to the actions of rivals.
