Case Study of Firehouse Subs Samples for Students †MyAssignmenthelp.c

Question: Discuss about the Case Study of Firehouse Subs. Answer: Introduction Firehouse Subs, officially known as Firehouse of America LLC is a fast casual restaurant which started in Florida in 1994. The brainchild of two brothers, who were firefighters in Jacksonville, the restaurant chain has over time grown to cover more than 40 states in the United States, Puerto Rico, Canada and Mexico. Having first tried to go into franchising the following year, Firehouse Dubs finally decided to actively pursue franchising as an expansion strategy at the turn of the century. It has consequently been powered by this strategy to open more than 1000 stores in the aforementioned places in North America (Firehouse, 2017). Industry Firehouse operates in an industry which has been singled out for increasingly taking aware the market share traditionally associated with the closely related fast food restaurants. Fast casual has been able to do this in part due to the negative attitudes directed towards fast foods. These foods have been accused of being unhealthy by causing obesity and related ailments, especially due to their higher calorie count and affordability (Anderson et al, 2011). The Fast casual foods are seen as being more healthful, though they are not as cheap. The other factor that has led to increased success of fast casual business is their increase in sheer numbers of stores, meaning that their food is now more readily available than it was thirty years ago (Firehouse, 2017). Market conditions For two decades, the sector enjoyed double digit growth in terms of market share increase. The biggest among them is Panera Caf which was tenth in the fortune 500 list of the most valuable companies in the United States. Firehouse was 66th in a list where 12% of the 500 companies were from the fast casual segment of the market. It is also worth noting that the growth rate indicated above has started to stabilize, as the industry reaches its peak. As a result, companies such as Firehouse will need to adopt more aggressive marketing strategies to gain more market share. This will also be necessary to successfully hold off stiff competition from fast food chains, including McDonalds and others (Lichtenberg, 2012). Companies which have been unable to stay up with the competition have gone bust. It is therefore more important for even other companies which are currently in stable to try not only hold on to the market that has been gained mainly from fast food restaurants, but also from other types of food businesses. In the long run, the survival of companies such as Firehouse will be determined by the strategies they take now, and how well they understand the market they operate within (DiPietro et al, 2007). Customer segments Fast casual restaurants such as Firehouse serve a customer segment of those who are willing to spend slightly more to take a quality meal .The menus carry a minimum USD 10 tag, meaning that they are mostly out of reach regularly for the lower income segment of the market, more ably served by fast food chains. At the same time, fast casual restaurants have not been as versatile in delivery services, meaning that this segment of the market is beyond them as well. In fact, this could be one of the tactics as part of a grand strategy which could result in significant market gains (DiPietro et al, 2007). Demand conditions In the US, fast casual industry accounts for close to 10% of the overall food industry. While this may be considered a small percentage of what is a multibillion dollar industry, it is worth noting that the segment has grown by more than five times its original size since 1999. This means that, while it has been indicated above that its growth is easing off; it is still experiencing a great period of growth which is not replicated elsewhere in the market, least not fast food restaurants. Some of these are actually having their own woes based on the success of fast casual foods. The situation is true of Firehouse, which together with others have been blamed for the woes bedeviling erstwhile giants such as Subway and others (DiPietro et al, 2007). Competitors Within the market, Firehouse is one of the biggest establishments, but not the biggest. This honor is held by Panera Caf. Other major players in the industry include Pizza Ranch, Pie Five, Noodles Company, among others. Some of these companies are major corporations in the world, establishing a presence in North America, Europe and Asia. The competition has for a long time not been vicious because of the exponential growth of the industry as a whole. However, this is likely to change as rivals jostle for a dwindling number of customers. Besides these competitors, fast food chains offer a different sort of challenge to establishments such as Firehouse. They have more money, and are better placed to run massive marketing campaigns which may alter market dynamics. At the same time, they offer cheaper substitutes, which may be more appealing to lower income people. They are not completely immune from the unhealthy tag that has been attached to fast foods, meaning that they may ultimately feel the negative effects of this (Anderson et al, 2011). Description of business products and services The firehouse has been able to establish its own market niche. It serves various foods including beverages, both cold and hot, special sub premium meats, platters, specialty salads and a special menu for children. The foods and beverages are prepared in a way which is unique to Firehouse and therefore responsible for generating a dedicated following of customers. Based on this, it has been able to charge premium prices as opposed to other companies. At the same time, Firehouse offers services, including catering and has undertaken steps to start a delivery service within the city limits of the urban centers it serves. Swot analysis Strengths Firehouse has one of the most recognizable fast casual brands in the US and other North American Countries. This is a strong asset as the company is geared mainly towards franchising and attracting investors to avail more funds for marketing and expansion. The company has a unique recipe which as implied before, has helped it amass a dedicated army of clients. It has a wide presence in more than 800 locations around the North American continent. It has a nutritional menu which attracts health conscious people, in part of a trend that is fast gaining popularity in the Western world (Kruger et al, 2008). Weaknesses Bedsides the three countries of the US, Canada and Mexico, the brand is virtually unknown elsewhere. This places it at a disadvantage when compared to other brands which are truly global, and are in sometimes direct competition with firehouse. There are limited customer focused programs available, when compared to the competition. This means that the company is less responsive to market trends and customer ants, something which may in future leave it at a disadvantage. Opportunities A more customer focused strategy would work to attract and retain more customers. Such tactics may include gift cards, happy hours and loyalty points, among others. By adding more variety to the existing menu, the company may attract more customers to its chain of restaurants. Additionally, the stores adoption of desserts into the menu would lead to a strong pull on customers, especially in instances where the same is not offered by other fast casual or fast food restaurants (Lichtenberg, 2012). Threats There are well-established fast casual restaurants which may actively try to take away the market share that the company has amassed so far. At the same time, people are more health conscious. They may move away from fast casual foods the same way they have moved away from fast foods. This will mean a loss of market share for Firehouse Sub among other similar establishments. There are more competitors in the market. Given that the industry is no longer growing as fast as it was before, this means that the company is now faced with more competition than before (DiPietro et al, 2007). Summary Firehouse Subs have been able to take advantage of one of the most lucrative segments of American food industry. However, this advantage may no longer offer the same amount of returns that has made it so attractive. To survive in the long-term, the company needs to adopt a more customer-centric strategy. At the same time, it needs to come up with a more solid marketing strategy which will safeguard and increase its market share against well moneyed and bigger brands than it. References Anderson, B., Lyon-Callo, S., Fussman, C., Imes, G., Rafferty, A. P. (2011). Fast-Food Consumption and Obesity among Michigan Adults. Preventing Chronic Disease, 8(4), A71. DiPietro, R., Murphy, K., Rivera, M., Muller, C. (2007). Multi?unit management key success factors in the casual dining restaurant industry: A case study. International Journal of Contemporary Hospitality Management, 19(7), 524-536, https://doi.org/10.1108/09596110710818275. Firehouse. (2017). Homepage. retrieved from https://www.firehousesubs.com/, accessed on 29/08/2017. Kruger, J., Michels Blanck, H., Gillespie, C. (2008). Dietary Practices, Dining Out Behavior, and Physical Activity Correlates of Weight Loss Maintenance. Preventing Chronic Disease, 5(1), A11. Lichtenberg, A. (2012). A Historical Review of Five of the Top Fast Food Restaurant Chains to Determine the Secrets of Their Success. CMC Senior Theses, 361.