What are the principal features of Outback Steakhouses strategy in the US? Why has the strategy been so successful?
Outback steakhouse is one of the leading restaurants in the United States of America. Since it was founded it can be said to be among the restaurants that has had a successful run in the business. For a business to be successful it has to come up with a number of strategies that will ensure that it operates smoothly and is able to make enough money to sustain the business. As such the Outback Steakhouse came up with the following.
Differentiation was one of their key strategies. For a business to be outstanding it has be different form the rest. In this particular case the managers and founders of Outback had to come up with a way in which Outback would be presented to its customers in a unique way. High quality food was top on their list, comfortable seats with a quiet atmosphere that is conducive for everyone. Another key strategy was serving only one meal. Outback only serves dinner. By this they are able to have enough time during the day to prepare for dinner and ensure that they offer am exemplary menu for their customers during dinner. Creating a good relationship with their suppliers and employees. This is very key in any business because if the suppliers supply fresh vegetables and foods then the food prepared will also be fresh and health. Establishing a good relationship with the employees on the other hand ensure that they work with a lot of motivation and are able to deliver their best and serve customers appropriately. The strategy has been successful because they looked at the main areas that directly affected Outback and its success.
What are the key elements of the international expansion strategy being proposed by Hugh Connerty?
Hugh Connerty admits that going international is not an easy task; it requires critical thinking and considering all the factors on the ground. One of Hugh Connerty key strategies on international expansion was to find the right franchise partner. He observed that people from other parts of the world reasoned differently from the people of America. He therefore felt the importance to have global partners who had the same mind-set as them. Having the same principles and goals would make working together easier. Suppliers are a very important aspect of Outback. Since it began operating it has never changed its suppliers. If it is go international then the same case applies to its suppliers as well. All its suppliers will have to be able to supply it with the required goods. Geographical positioning of the new outlets was key point for Connerty, he proposed that they first open a restaurant in Canada then with time open another one in Hawaii and eventually with time move to the Far East.
Assess the proposed strategy in relation to (a) Should Outback Steakhouse expand internationally, or would it be better to expand through starting new restaurant chains within the US?
From the proposed strategy by Hugh Connerty Outback Steakhouse should expand within the United States first. This is because the strategies proposed by Connerty cannot be achieved easily. To begin with suppliers would find it difficult to move to another country. This would be probably due to lack of sufficient funds to transport the merchandise and the also storage equipment because in this particular case we are dealing with food. Finding the right franchise partner could also be challenging because Outback is not familiar with the government regulations and travel restrictions in other countries. In regards to geographical suitability it is better that Outback concentrate more on the expanding internally within the United States for a while then eventually after the restaurant is well known and advertised in other countries it can go international.
(b) Does the strategy outlined by Connerty make sense?
The strategies outlined by Connerty makes sense because, the key points the points across are of great essence to Outback Steakhouse in regards to its intentions of going international. These factors not only apply to Outback only but also to any other restaurant or business that has plans to go international.
If Outback is to expand internationally, advise Chris Sullivan on (a) The optimal rate of international expansion.
I would advise Chris Sullivan to begin by stating a small restaurant in a country like United Kingdom which is an Anglo-Saxon country and has almost the same similarities as the USA in regards to customer reactions and market strategies. By doing this they would be playing safe and chances of the restaurants doing well would be high. Entry into Canada would also be another consideration; however, proper strategies should be lied down to ensure that once they open the restaurants its customer base will have increased. This can only be achieved by opening Outback Steakhouse restaurants in towns close to the Canadian border.
(b) The best mode of entry into foreign markets (e.g. direct management, JV, franchise).
I would propose direct management as the best entry into foreign markets. Direct management includes managers that are well experienced taking charge of the new restaurants. This will make sure that the way the restaurants are run and managed in America is translated to the other foreign countries. After a year or two then the franchise mode can take place.
(c) Which country (ies) to enter first
I think the countries to enter first would be Canada. This is because Canada has a market that is almost similar to America. United Kingdom would be next to enter because of the fact that it as a Anglo-Saxon country and it has a customer base almost as busy as America.
. (d) Whether Connerty is the right person to head the International Division.
Connerty is a well-educated man and has the experience to run Outback Steakhouse. However I think his experience best suits him to run restaurants in America as opposed to foreign nations. The head of international division should be a person who is well conversant with foreign markets and has worked with some of them as well.
Mahmoud M. Hamid. Outback Strategic Marketing Analysis. Sep 26, 2012.Clara Pardo Diaz. Outback Steakhouse: Going International. December 2014.
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