Free Essay

Pizza Hut, Inc.

In: Business and Management

Submitted By yourfriendneeru
Words 321
Pages 2
1. Situation Analysis

Customer Analysis:

• Consumption was more significant in the northern and the eastern parts of the United States

• Pizza was predominantly a dinner food, sometimes considered as a snack. Thus emphasizing that demand was specifically skewed during particular time periods of the day.

• Pizza generally conceived as eat-at-home food, especially since the advent of in-home rental videos and increasing number of baby boomers with small children.

• Preferred delivery systems to eat-in or carry-out pizza outlets.

• According to franchisees, customers seldom cared about price-per-square inch of pizzas, rather the absolute prices of the small, medium and large sized pizzas mattered more to them

Context Analysis:

• Growing demand for purely delivery based system

• Franchisees which introduced delivery were doing significantly better than company-owned stores.

• Prevalence of discounting in the pizza business

Competitor analysis:

• Initially only Godfather pizzas were next best in the business

• Dominoes rapidly expanding into the Pizza Delivery-only market

• Recent promotions into areas where Pizza hut is planning to enter

• A little more tedious to implement CSC in their outlets

• Have been a motivation to the franchisees for not implementing CSC’s

Company analysis:

• Market leader for a long while before 1986, when dominoes happened

• Losing business on eat-in and carry-out business sectors

• Need for investment on Delivery-out models

• Franchisee-dependent for sales

• Strong opposition from franchisees

• Delivery out models not successful enough for company owned outlets

• SWOT Analysis

|Strengths | |
|Weakness | |
|Opportunities | |
|Threats | |

2. Problem Identification

• CSC system expensive yet productive when it comes to metropolitan centres

• Franchisee opposition with regards to upsizing

• Restaurant specific pizzas not conducive for delivery systems

• Failure of delivery out models in company run outlets

• Unexpected working of delivery out models in some of the franchisees which tried it

• Dominoes competing fiercely in areas of probable expansion

• Split of national advertising account for eat-in and delivery models separately causing issues of coordination

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