Levy Restaurants Case Study Solution

Business is currently one of the biggest food chains worldwide. It was founded by Henri Levy Restaurants in 1866, a German Pharmacist who initially released "FarineLactee"; a combination of flour and milk to feed babies and reduce mortality rate.
Business is now a multinational business. Unlike other international companies, it has senior executives from various nations and attempts to make choices thinking about the entire world. Levy Restaurants presently has more than 500 factories around the world and a network spread across 86 nations.

Purpose

The function of Business Corporation is to improve the quality of life of individuals by playing its part and providing healthy food. While making sure that the business is prospering in the long run, that's how it plays its part for a better and healthy future

Vision

Levy Restaurants's vision is to offer its consumers with food that is healthy, high in quality and safe to eat. Business visualizes to develop a trained labor force which would help the company to grow
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Mission

Levy Restaurants's mission is that as currently, it is the leading business in the food industry, it believes in 'Great Food, Good Life". Its mission is to provide its consumers with a range of choices that are healthy and finest in taste too. It is focused on offering the best food to its customers throughout the day and night.

Products.

Levy Restaurants has a broad variety of products that it provides to its clients. In 2011, Business was noted as the most rewarding company.

Goals and Objectives

• Bearing in mind the vision and mission of the corporation, the company has actually laid down its goals and goals. These objectives and goals are noted below.
• One goal of the company is to reach no land fill status. It is pursuing no waste, where no waste of the factory is landfilled. It motivates its workers to take the most out of the spin-offs. (Business, aboutus, 2017).
• Another goal of Levy Restaurants is to lose minimum food during production. Frequently, the food produced is lost even prior to it reaches the customers.
• Another thing that Business is dealing with is to enhance its packaging in such a method that it would help it to minimize the above-mentioned problems and would also guarantee the shipment of high quality of its products to its customers.
• Meet worldwide requirements of the environment.
• Build a relationship based on trust with its customers, company partners, employees, and federal government.

Critical Issues

Just Recently, Business Business is focusing more towards the method of NHW and investing more of its profits on the R&D technology. The country is investing more on acquisitions and mergers to support its NHW technique. The target of the company is not accomplished as the sales were expected to grow greater at the rate of 10% per year and the operating margins to increase by 20%, offered in Display H.

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The present Business method is based upon the idea of Nutritious, Health and Wellness (NHW). This method handles the idea to bringing change in the consumer choices about food and making the food things healthier worrying about the health issues.
The vision of this method is based upon the key approach i.e. 60/40+ which just implies that the items will have a score of 60% on the basis of taste and 40% is based on its dietary worth. The items will be produced with extra dietary value in contrast to all other items in market acquiring it a plus on its dietary material.
This method was adopted to bring more yummy plus nutritious foods and beverages in market than ever. In competitors with other companies, with an intention of retaining its trust over clients as Business Business has gained more trusted by customers.

Quantitative Analysis.

R&D Costs as a portion of sales are declining with increasing actual quantity of costs reveals that the sales are increasing at a higher rate than its R&D costs, and enable the company to more invest in R&D.
Net Profit Margin is increasing while R&D as a percentage of sales is decreasing. This indicator also shows a green light to the R&D costs, mergers and acquisitions.
Debt ratio of the company is increasing due to its spending on mergers, acquisitions and R&D development instead of payment of debts. This increasing debt ratio pose a hazard of default of Business to its investors and might lead a decreasing share costs. In terms of increasing debt ratio, the company ought to not spend much on R&D and must pay its present debts to decrease the threat for financiers.
The increasing risk of financiers with increasing debt ratio and decreasing share costs can be observed by substantial decrease of EPS of Levy Restaurants stocks.
The sales growth of company is likewise low as compare to its mergers and acquisitions due to slow understanding structure of consumers. This sluggish growth likewise impede company to more invest in its mergers and acquisitions.( Business, Business Financial Reports, 2006-2010).
Keep in mind: All the above analysis is done on the basis of calculations and Charts given up the Exhibitions D and E.

TWOS Analysis

2 analysis can be utilized to obtain various techniques based upon the SWOT Analysis given above. A quick summary of TWOS Analysis is given up Exhibition H.

Strategies to exploit Opportunities using Strengths

Business needs to introduce more innovative products by large amount of R&D Spending and mergers and acquisitions. It might increase the marketplace share of Business and increase the earnings margins for the company. It could also offer Business a long term competitive advantage over its rivals.
The international expansion of Business should be focused on market catching of establishing nations by expansion, bring in more customers through customer's loyalty. As establishing nations are more populous than developed nations, it could increase the customer circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Levy Restaurants must do mindful acquisition and merger of organizations, as it could affect the client's and society's understandings about Business. It needs to obtain and merge with those business which have a market track record of healthy and healthy business. It would enhance the perceptions of customers about Business.
Business should not just invest its R&D on development, instead of it needs to likewise concentrate on the R&D costs over evaluation of expense of various nutritious products. This would increase expense efficiency of its items, which will lead to increasing its sales, due to declining rates, and margins.

Strategies to use strengths to overcome threats

Business must move to not only establishing however also to developed countries. It must widens its geographical growth. This large geographical expansion towards establishing and established countries would lower the danger of prospective losses in times of instability in numerous nations. It ought to widen its circle to different countries like Unilever which runs in about 170 plus countries.

Strategies to overcome weaknesses to avoid threats

Levy Restaurants should sensibly control its acquisitions to prevent the risk of mistaken belief from the customers about Business. It must obtain and merge with those countries having a goodwill of being a healthy company in the market. This would not only improve the understanding of consumers about Business however would also increase the sales, profit margins and market share of Business. It would also make it possible for the company to use its prospective resources effectively on its other operations instead of acquisitions of those organizations slowing the NHW strategy development.

Segmentation Analysis

Demographic Segmentation

The market segmentation of Business is based upon 4 elements; age, gender, earnings and occupation. For example, Business produces numerous products associated with babies i.e. Cerelac, Nido, and so on and related to adults i.e. confectionary products. Levy Restaurants products are rather budget-friendly by nearly all levels, but its significant targeted consumers, in terms of earnings level are middle and upper middle level consumers.

Geographical Segmentation

Geographical segmentation of Business is composed of its presence in nearly 86 countries. Its geographical segmentation is based upon 2 main factors i.e. average income level of the customer as well as the climate of the area. Singapore Business Business's segmentation is done on the basis of the weather condition of the region i.e. hot, warm or cold.

Psychographic Segmentation

Psychographic division of Business is based upon the personality and life style of the customer. Business 3 in 1 Coffee target those customers whose life style is rather busy and do not have much time.

Behavioral Segmentation

Levy Restaurants behavioral segmentation is based upon the attitude knowledge and awareness of the consumer. Its highly healthy products target those consumers who have a health conscious mindset towards their usages.

Levy Restaurants Alternatives

In order to sustain the brand name in the market and keep the client intact with the brand, there are two alternatives:
Alternative: 1
The Company must invest more on acquisitions than on the R&D.
Pros:
1. Acquisitions would increase total possessions of the company, increasing the wealth of the company. However, costs on R&D would be sunk cost.
2. The company can resell the acquired systems in the market, if it fails to execute its strategy. However, amount spend on the R&D could not be revived, and it will be thought about completely sunk cost, if it do not offer potential outcomes.
3. Spending on R&D provide slow growth in sales, as it takes long time to introduce a product. Nevertheless, acquisitions supply fast outcomes, as it supply the company already developed product, which can be marketed not long after the acquisition.
Cons:
1. Acquisition of business's which do not fit with the business's values like Kraftz foods can lead the business to deal with misunderstanding of consumers about Business core worths of healthy and healthy items.
2 Large spending on acquisitions than R&D would send out a signal of company's inadequacy of establishing ingenious items, and would outcomes in customer's dissatisfaction.
3. Large acquisitions than R&D would extend the product line of the business by the items which are currently present in the market, making business not able to introduce new ingenious products.
Alternative: 2.
The Business must spend more on its R&D instead of acquisitions.
Pros:
1. It would enable the company to produce more ingenious products.
2. It would supply the company a strong competitive position in the market.
3. It would allow the business to increase its targeted consumers by introducing those items which can be provided to a completely brand-new market segment.
4. Innovative items will offer long term advantages and high market share in long run.
Cons:
1. It would reduce the earnings margins of the business.
2. In case of failure, the whole costs on R&D would be considered as sunk cost, and would impact the business at large. The danger is not in the case of acquisitions.
3. It would not increase the wealth of company, which could offer an unfavorable signal to the financiers, and might result I decreasing stock costs.
Alternative 3:
Continue its acquisitions and mergers with significant costs on in R&D Program.
Pros:
1. It would permit the business to present brand-new ingenious items with less threat of converting the costs on R&D into sunk cost.
2. It would provide a positive signal to the financiers, as the total assets of the business would increase with its significant R&D costs.
3. It would not affect the revenue margins of the company at a large rate as compare to alternative 2.
4. It would offer the business a strong long term market position in regards to the business's general wealth as well as in regards to ingenious products.
Cons:
1. Threat of conversion of R&D costs into sunk expense, greater than option 1 lesser than alternative 2.
2. Danger of misunderstanding about the acquisitions, greater than alternative 2 and lesser than option 1.
3. Intro of less variety of ingenious items than alternative 2 and high variety of ingenious items than alternative 1.

Levy Restaurants Conclusion

Business has stayed the leading market player for more than a years. It has institutionalized its methods and culture to align itself with the market modifications and client habits, which has eventually allowed it to sustain its market share. Though, Business has established substantial market share and brand identity in the city markets, it is recommended that the company should focus on the rural areas in terms of developing brand name commitment, awareness, and equity, such can be done by creating a specific brand allotment strategy through trade marketing tactics, that draw clear difference between Levy Restaurants products and other competitor items. Moreover, Business should leverage its brand name picture of safe and healthy food in catering the rural markets and also to upscale the offerings in other classifications such as nutrition. This will permit the business to establish brand equity for freshly introduced and already produced items on a greater platform, making the effective use of resources and brand name image in the market.

Levy Restaurants Exhibits