Context Analysis - PowerPoint PPT Presentation


PPT – Context Analysis PowerPoint presentation | free to download - id: 153a2-YTQzY


The Adobe Flash plugin is needed to view this content

Get the plugin now

View by Category
About This Presentation

Context Analysis


Will the regulatory environment affect the industry? ... KFC ... KFC has come under fire recently over their the way their chickens are raised and slaughtered ... – PowerPoint PPT presentation

Number of Views:291
Avg rating:3.0/5.0
Slides: 79
Provided by: Madi9
Learn more at:
Tags: analysis | context | kfc


Write a Comment
User Comments (0)
Transcript and Presenter's Notes

Title: Context Analysis

Context Analysis
  • Is the Quick Service Food Industry a Good Place
    to Be?
  • September 28, 2005
  • Group A4
  • Stephanie Baron
  • Jennifer Jones
  • Christine Tahvonen
  • Nichole Tips
  • Bryant Young
  • Bill Zanow

Defining the Market Context
  • What is the demographic environment?
  • Does the sociocultural environment fit?
  • Is the economic environment favorable?
  • Will the regulatory environment affect the
  • How could the technological environment hinder or
    advance the industry?
  • What is the natural environment?

Demographic Environment
The Demand for Food Away from Home
  • Consumer Spending at full service and fast food
    restaurants will continue to grow, but the
    largest increase will occur for full service
  • Per capita spending at fast food restaurants
    could grow 6 by 2020 as opposed to 15 for full
    service restaurants (assuming 1 annual growth in
    real income)
  • The increasing proportion of households without
    children living at home will cause spending to go
    up by 1-2
  • The aging of the population will decrease
    spending on fast food by 2 per capita between
    2000 and 2020

Change in Per Capita Spending Due to Demographic
and Economic Trends
How Demographic Trends Will Affect the Restaurant
  • The National Restaurant Association believes that
    the overall growth of the market will depend on
    rising incomes and demographic changes (aging
    population, smaller household sizes, rising
    number of households with single people or
    multiple adults without live-at-home children)
  • Any shift in the market share could affect what
    food and services both types of restaurants offer
  • Full service restaurants are a growing threat to
    fast food restaurants

Consumer Spending on Full Service vs. Fast Food
Segments of the Market Full-Service vs. Fast
Current Projected Population Statistics
World Population Growth Rate1950-2050
World Population 1950-2050
U.S. Population 2005 2025
Household Characteristics Expected
Fast Food Franchise Opportunities
  • Fast food franchises continue to be among the
    most popular of all franchise opportunities
  • According to the U.S. government, fast food
    consumption now accounts for over 40 percent of
    an average family's budget spent on food
  • This growth trend is expected to continue, as the
    dietary needs of the pubic change and menus
    expand to accommodate more ethnic preferences
  • Fast food franchises are as effective at turning
    a profit as they are at delivering a quick meal

Fast Food Clusters Around Schools
  • Fast-food restaurants are concentrated within a
    short walking distance from schools, exposing
    children to poor-quality food environments in
    their school neighborhoods
  • The median distance from any school in Chicago to
    the nearest fast-food restaurant was half a mile,
    a distance that an adult can walk in little more
    than 5 minutes
  • Fast-food restaurants were statistically
    significantly clustered in areas within a short
    walking distance from schools, with an estimated
    3 to 4 times as many fast-food restaurants within
    1.5 km from schools than would be expected if the
    restaurants were distributed throughout the city
    in a way unrelated to school locations
  • According to a study by Harvards School of
    Public Health, the pattern probably exists in
    urban areas nationwide and is likely contributing
    to the nations obesity epidemic

Sociocultural Trends
The Natural Marketing Institute's Top 10 Health
Wellness Trends of 2005
  • The Immediacy of Health and Wellness Escalates
  • The Three Fs of Food Trends Fiber,
    Functionality and Fat
  • The Healthy Get Healthier The Good, the Bad and
    the Ugly
  • Weight Loss Stability, Challenges and Apathy
  • Planetary Health and Wellness Is it Cool to be
  • Sources of Influence Become Multi-Dimensional
  • Nutritional Supplements Can New Science and New
    Claims Revitalize the Category?
  • From Low-Carb to Slow-Carb A Redefinition
  • Reality Gaps Between What Consumers Say and What
    They Do
  • The Organic Market Finding the Real Value

Obesity in America
Calorie Intake Portion Control
  • Calorie intake has increased
  • Portion size has increased (Value Meals)

  • Two sides to this trend
  • Helping people lose weight
  • Fast-food chains are lightening their menus
  • More and more school districts are removing junk
    food from campuses and replacing it with
    healthier options
  • Helping heavier people live more comfortably
  • Health club membership rose by 8.5 percent
    between 2002 and 2003
  • Medicare recently began covering gastric bypass
  • Flip Side
  • More than 60 percent of women and teens wear
    plus-size clothing
  • The kids plus-size apparel market is growing

(No Transcript)
Obesity in America
  • Obesity increased by 74 percent during the past
    decade to 44 million adults in 2001
  • The proportion of Americans who are severely
    obese also has soared from 1 in 200 adults in
    1986 to one in 50 adults in 2000
  • About 127 million adults are overweight which
    means two-thirds of adults nationwide are more at
    risk for developing conditions such as high blood
    pressure, diabetes, heart disease, stroke, gall
    bladder disease and certain cancers
  • The rise in obesity costs U.S. businesses an
    estimated 12.7 billion in health care, sick
    leave and insurance premiums
  • Increased television watching, larger meal sizes
    and inventions such as the remote control and
    riding lawn mowers have pushed up obesity rates
  • The work force has shifted from agriculture and
    manufacturing to service jobs, in which workers
    sit in front of computers all day

Obesity in America
  • Americans have longer workdays than those in most
    other countries, cook fewer home meals and rely
    more on frozen and fast food for nutrition
  • A recent University of Maryland study found that
    people living in the suburbs where homes are
    mainly accessible by car were more likely to be
    obese People in more developed counties tended
    to exercise more from climbing stairs or walking
    to errands
  • An estimated 10 of America's preschoolers are
    dangerously overweight
  • Obesity rates for elementary school students have
    tripled in the last three decades
  • 31 of adults in the U.S. are now considered
    obese (at least 30 pounds overweight)
  • Increase in the proportion of Americans
    characterized as overweight, from 47 in the late
    1970s to more than 65 in 2002, including 31 who
    were clinically obese
  • Medical costs attributable to obesity reached 75
    billion in 2003, almost half of which fell on
    taxpayers through public health-care schemes

(No Transcript)
(No Transcript)
(No Transcript)
Fitness and Weight Loss
  • The fitness buzzword for 2005 Core
  • This trend is all about strengthening and
    stabilizing the muscles of your midsection
  • Expect the next 12 months to bring expansion
    across a variety of industries Fitness and
    weight-loss franchises will grow as Americans
    continue their battle to get slim
  • The number of fitness and weight-loss franchisors
    in the Franchise 500 grew from 8 to 17
  • According to the International Health, Racquet
    Sportsclub Association, 39.4 million Americans
    belong to a health clubup from 24.1 million 10
    years agoso there are definitely more than
    enough consumers joining in to feed this growing

Top 10 Trends in Food and Cookingfor 2005
  • 1. High-Fiber
  • 2. Drive-By Dining - Fast-food chains have been
    quick to tout cup-holder cuisine for lunch and
    dinner. The whole concept got a big
    breakfast-time boost with the roaring success of
    McDonald's "McGriddle" sandwiches.
  • 3. Phood - Phood is a combination of food with a
    pharmaceutical pitch - comestibles with health
    benefits. For example, breakfast cereals and
    margarines market their ability to reduce the
    risk of heart disease.
  • 4. White Tea - more expensive than green or black
    tea and has a different production process. It
    has higher levels of antioxidants, natural
    chemicals, which are thought to prevent cancer.
  • 5. Local vs. Long-Distance - For some folks,
    organic isn't enough. Their food also has to be
    grown next door. Proponents of locally produced
    foods say the practice ensures fresh, wholesome
    food. Instead of woody "shipper-friendly"
    tomatoes, you get the juicy kind (but only
    in-season, of course). Local production also
    reduce the energy expended in shipping and
    supports local jobs. Watch for local growers in
    2005 who will offer a full season of produce on a
    subscription basis.

Top 10 Trends in Food and Cookingfor 2005
  • 6. Let Someone Else Do the Cooking - HRM Home
    Meal Replacement has been gathering steam for
    some time now. Pizza joints have eliminated their
    dining rooms in favor of delivery and carry-out.
    And grocery stores now stock huge buffets of hot
    and cold fare that's designed to pack up and
    bring home. In 2005, watch the "fast casual"
    chains Applebee's launch curbside catering
    programs that let you call ahead and pick up your
    meal in dedicated parking spaces.
  • 7. Gender Vending - Marketing products to one sex
    is the trend in the food industry. For example,
    vitamin and supplement producers have been doing
    this for years to advertise easing the symptoms
    of menopause or improve prostate health. Products
    like "Harmony" cereal and "Nutrition for Women"
    oatmeal are focusing specifically on women. For
    the men, beer seems to still be focused toward
  • 8. Flexitarians - Meat-heavy restaurants that
    offer "veggie" options on their menus are really
    going after the flexitarians, say trend mavens,
    catering to folk who might want to go vegetarian
    a few times a week.
  • 9. Seitan - the new tofu. This is not a new
    food. It is wheat-based, high-protein food and
    its texture makes it an easy substitute for meat.
  • 10. Just a Taste, Thank You - Restaurants on the
    coasts have been offering bite-size portions for
    a while now. Expect the small-plate trend to make
    inroads to the heartland in 2005.

Fitness and Weight Loss
  • The fitness and weight-loss industries are hot
    and on the rise

Young Children Schools
  • Low-income people tend to be more overweight than
    the average population because they buy cheaper,
    sugar-laden foods and have less knowledge of
    healthy diets
  • More states tighten nutritional guidelines,
    schools stand to lose millions of dollars from
    vending machine sales
  • About 70 of 832 public schools polled in 2001
    said they had a partnership with a food or
    beverage company to fund programs
  •     Some principals are worried about losing
    their ability to have food fund-raising programs
    in schools

Portion Control Is Bigger Better?
In Touch with the Community
  • Dave Thomas Foundation for Adoption
  • Dave founded this organization to help the
    thousands of children throughout the United
    States find permanent homes and loving families.
  • Wendy's Wonderful Kids funds adoption recruiters
    across the nation that focus exclusively on
    finding permanent adoptive homes for children in
    foster care.
  • Wendy's Championship for Children The Wendy's
    Championship for Children at Tartan Fields is
    widely recognized as the premier woman's
    professional sporting event held annually in
    Central Ohio.
  • Wendy's 3-Tour Challenge Each year professional
    golfers from the PGA, LPGA and Senior PGA Tours
    battle it out to see who will be victorious in
    the Wendy's 3-Tour Challenge Golf Tournament.
  • Wendy's Classic Achiever Scholarship Program
    Wendy's Canada honoured 210 Classic Achiever
    Award winners with scholarships to help fulfill
    their dreams of post secondary education.
  • Deletree Conmigo Wendy's Deletree Conmigo is an
    in-school, bilingual spelling bee competition and
    curriculum-enhancing program.
  • Wendy's High School Heisman Program Dave Thomas
    created the WHSH program to honor top students
    nationwide who excel in academics, athletics and
    community service.

Home Cooking
  • Home cooking may also be making a comeback,
    helped by two factors
  • The percentage of women joining America's
    workforce may have peaked
  • Supermarket chains such as Wal-Mart have been
    forcing down retail food prices

Vegetarian Options
  • Burger King
  • Burger King has had its BK Veggie burger
    available since 2001
  • In Canada the BK Veggie is made by Sol Cuisine
    and is vegan. The U.S. version used to be vegan,
    but as of Dec 2004, it now contains egg whites
  • Harveys
  • Harveys was one of the first burger chains to
    develop and promote its own simply named, Veggie
    Burger. It is a soy-based patty without a lot of
    chemicals and is totally vegan. Their policy is
    to cook the burger on a separate part of the
    grill when possible
  • Aug. 14 2005 Update 'Veggieburger (even by
    itself) is flagged for those allergic to fish
  • McDonalds Only in Canada is there a veggie
    burger called the McVeggie on their menu
  • They have also released some side salads to
    accompany the McVeggie
  • McDonalds still hasnt figured out a separate
    grill for its veggie burger so a warning is
    posted on their website During preparation, the
    McVeggie Burger may come in contact with meat
    and/or chicken products.
  • McDonalds has introduced two vegetarian salads
    and a vegan one called Mandarin California Greens
  • Warning McDonalds fries still contain beef fat

Vegetarian Options
  • Wendys
  • The last holdout of the veggie burger movement
  • Two salads include the spring mix salad is
    vegetarian but is still loaded with shredded
    cheese and its honey roasted pecans contain
    lactose. The side salad is vegan and comes with
    three vegan dressings, oriental sesame, house
    vinaigrette and a fat-free French dressing that
    contains honey. The Caesar dressing contains
    anchovies and the other dressings are loaded with
    milk and eggs
  • Wendys has two vegetarian baked potatoes the
    Broccoli and Cheese Baked Potato and the Sour
    Cream and Chives Baked Potato
  • Their fries are vegan but may be cooked in the
    same oil as the chicken nuggets
  • Wendys buns are vegan
  • Subway
  • Subway suggests that you inquire at individual
    stores as products can vary from region to region
  • Subways breads are all vegetarian (the cheese
    breads contain rennet of unknown origin) and the
    following are vegan Italian bread, roasted
    garlic bread, hearty Italian bread and sourdough
  • Subways cookies all contain egg products and
    some contain milk products but are otherwise

Vegetarian Options
  • KFC
  • In Canada, the only things remotely vegetarian
    are a potato salad, a pasta salad and coleslaw.
    None of these are vegan
  • In the U.S. menu options include macaroni and
    cheese, three bean salad, corn-on-the-cob and
    mashed potatoes
  • KFC has come under fire recently over their the
    way their chickens are raised and slaughtered
  • Taco Bell
  • Beans can be substituted instead of meat to make
    many menu options vegetarian
  • The corn-based shells are vegan, free of
    hydrogenated fats and have relatively short
    ingredient lists
  • Hot, mild and fire sauces are all vegan and
    loaded with chemicals
  • Taco Bells fries are vegan and are cooked in
    their own 100 vegetable oil
  • As of 2004 soft shells (for burritos or soft
    tacos) and the Mexican rice contain no obvious
    animal ingredients
  • Tim Hortons
  • All Tim Hortons products are vegetable-based

Is Fast-Casual Slowing Down?
  • Statistics show American diners eat out more than
    they did last year (2004)
  • Surveys show theyre willing to spend more to get
    better food in finer surroundingsand an entire
    genre of dining emerged to take advantage of that
    consumers largesse
  • Fast-casual came on strong because quick-service
    was so weak, however they arent competing
    against the Whopper anymore.
  • Due to customer preferences of better competitors
    have added premium salads, sandwiches, and leaner
    offerings to their menu once dominated by cheap
    eats and fries
  • At the end of 2002, comps for leading fast-casual
    brands, including averages from Baja Fresh,
    Panera, Rubios Baja Grill, and Schlotzskys were
    at 2.7 percent, compared to 2.5 percent for
    casual dining and 4 percent for a segment in the
    quick-serve/hamburger branch

Is Fast-Casual Slowing Down?
  • A year later, fast-casual closed out with a 0.6
    percent increase in comparable sales for 2003,
    well behind the 2.1 percent increase shown by
    casual eateries. The hamburger segment comp sales
    for 2003 4.1 percent
  • If you cant beat em, join em venture
  • McDonalds acquisition of Chipotle Mexican Grill
    allowed them to grow in a new direction, even as
    it improved its food quality
  • Wendys in 2002 bought Baja Fresh, another
    fast-casual Mexican brand, and took a chunk of
    Café Express and Pasta Pomodoro
  •  One of the things data shows is that fast-casual
    might have problems with diner frequency
  • A heavy user of quick-serve might patronize a
    store three to four times a week, but upscale
    folks have different dynamics. In comparison,
    fast-casual has inspired some serious loyalties
    for particular brands, but many folks are opting
    to spend a little more for the casual dining
    experience. Some 70 percent of casual-dining
    business comes from repeat customers wholl
    upgrade instead of standing in line for something
    that is now comparable to what they could get at
    one of the traditional quick-serves
  • The reality check Fast-casual sales account for
    5 billion annually. McDonalds does 20 billion
    a year

Economic Environment
U.S. Unemployment Rate
  • U.S. unemployment has declined in recent periods

  • US Real GDP has grown consistently over the past
    5 years

Inflation Rate
  • Inflation has increased at a steady rate for the
    past several years

Oil/Gas Prices
  • Gasoline prices are moving toward an all time
    high in 2005 dollars

Effects of Hurricane Katrina
  • With nearly 1 million jobs lost in the Gulf
    Coast, unemployment rates will increase
  • Forecasts for GDP in Q3, Q4 and 2006 have all
    been adjusted downward
  • Higher energy costs are contributing to in
    increase in inflation
  • Damage done to refineries and supply lines will
    continue to effect oil/gas prices

Economic Environment Conclusions
  • Decrease in discretionary income as consumers pay
    more at the pump and heating homes
  • Decrease in travel due prices at the pump
  • Increase in supplier costs and food preparation

Regulatory Environment
Mad Cow Disease Background
  • Common name for bovine spongiform encephalopothy
    (BSE), a slowly progressive, degenerative, fatal
    disease affecting the central nervous system of
    adult cattle
  • BSE linked to approximately 150 deaths from
    Creutzfeldt-Jakob disease, a rare but fatal
    degenerative disease in humans
  • One human case reported in the U.S. (someone who
    lived in U.K. during their outbreak)

Mad Cow DiseaseRegulatory Effects
  • First discovered in the U.S. in 2003 in a
    Canadian-born cow in Washington
  • Nov. 2004 Texas-born cow identified but not
    confirmed to have BSE until July 2005
  • 2003 U.S. required the removal of the small
    intestine when cow is slaughtered
  • Sept. 7, 2005 FDA and agriculture dept. ease
    rules to allow a portion of the small intestine
    to be used as a casing for specialty sausage
  • The department is aware of the financial
    hardship on businesses that make ethnic
    sausages, Daniel Engeljohn, Dept. of Agriculture
    Health Safety Inspection office

Mad Cow DiseaseRegulatory Effects
  • Sept. 19, 2005 Lester M. Crawford, FDA
    Commissioner, announces that new regulations will
    be put into place that bans using ground up
    cattle remains as protein for other animals
  • Currently banned for cows, but not other animals
    which could then be fed back to cows
  • This regulation will close the gap
  • Will mirror pending regulations that will soon be
    implemented in Canada

Americans Response to Reports aboutMad Cow
who say they or someone in their family has
Stopped ordering beef at fast food restaurants
Stopped buying beef at the grocery store
Stopped ordering beef at other restaurants
Stopped eating hamburger or ground beef
Stopped eating beef completely
Started buying and eating only organic or
grass-fed beef
Sources Harvard School of Public Health/ICR
poll (January, 2004)
Mad Cow DiseaseRegulatory Effects
  • Unlike the sausage industry, sales have not been
    negatively impacted to the point that legislation
    will be revised, although as early as 2001,
    McDonalds reported losses of earnings due to the
    European outbreak of mad cow disease and
    resulting loss of market there
  • This will be an area to watch in coming years, as
    any type of legislation could effect all
    competitors. Looser rules could affect public
    opinion, decreasing the market for burgers, while
    stricter rules could raise the price, and either
    will have a negative impact on profits

Reduced Labor Regulations
  • New proposal by the Dept. of Labor would allow 14
    and 15 year olds to operate and clean restaurant
    equipment, specifically
  • Operate hot electric/gas grills without an open
  • Operate hot, non-pressurized deep fat fryers that
    automatically raise/lower cooking baskets
  • Clean, maintain repair cooking devices if the
    surface or cooking liquid has cooled to no more
    than 140 degrees

Reduced Labor Regulations
  • Education Trust (Washington think tank) estimates
    that 80 of the 10.3 million workers in the food
    service industry are age 18-24
  • With new labor laws allowing younger employees,
    this will only increase

Product Label Regulations
  • 2006 food product labels will be required to
    include trans fat info (federal govt recommends
    trans fat be less than 1 of total calories in
    2000 calorie diet)
  • This regulation does not include fast food
    restaurants although most claim to already do so
    (its just hard to find)
  • FDA is considering a proposal by the Center for
    Science in the Public Interest that would
    require disclosure of trans fats by fast food
    chains (similar proposal also going to Senate)

Product Label Regulations
  • Legislation in Canada that wouldve required
    fast food chains post the number of calories in
    menu items beside prices on menu boards, and
    require full-service restaurant chains (where
    more spacious menus are provided) to also display
    the amounts of saturated fat plus trans fat, and
    sodium was eventually withdrawn by its sponsor
  • According to the Canadian Restaurant and
    Foodservices Association, In an industry that
    thrives on 'made to order' menu items, daily
    specials, changing menu items and seasonal
    ingredients, the requirements of the bill would
    have been impossible to implement. In addition,
    the bill ignored the fact that restaurants
    respond to a wide range of dietary concerns among
    their customers - from calories to carbs to
    life-threatening food allergies.
  • Although the bill was referred to the Standing
    Committee on Health for further study, its
    likely that the industry will always exert
    pressure to keep such legislation from passing.
    The same thing will likely happen in the U.S.

Advertising Regulations
  • 73 of Americans favor restricting food
    advertising directed at children 2004 Yale
    University Poll
  • FTC Chair Deborah Majoras is not in favor of
    government regulations on food and beverage
    advertising aimed at kids
  • The industry favors self-regulation but there is
    no impetus to pull products or limit advertising
    which will only reduce market share
  • 20 states have enacted common sense consumption
    laws and 11 additional are in progress
  • On the national level, the Personal
    Responsibility in Food Consumption Act the
    Cheeseburger bill was passed by the House in
    2004 but never went to the Senate it was
    reintroduced in 2005 to ban most obesity-related
    lawsuits against producers and retailers of food
  • It will take congressional action for any
    regulations to be imposed.

Technological Environment
Technological Environment
  • The main theory of fast food industries is to be
    fast, companies must keep up with technological
    advances to improve efficiencies
  • 2/3 of fast food business is done through the
  • display screens with your order listed and dollar
    amount - allows for accuracy and speed
  • having employees use easy to read touch screen
    cashiers - increases rate of volume
  • packaging must be car-friendly - such as fries
    in a cup shape
  • Some technological advances that could hurt the
  • Mass market strategy by Tivo Executives that want
    to make it possible for every home to afford a
    Tivo system
  • Allowing consumers to fast forward through ads
  • XM Satellite Radio which can be used in the home
    or car
  • This systems allows consumers to listen to
    specific music without interruption

Technological Environment
  • Using technological advances to the industries
  • From a marketing standpoint most recently have
    been able to use the Internet as a way to gain
    consumer preferences. Surveying viewers or
    advertising space on different target market
  • Currently 60 of households have cell phones, by
    2010 it is estimated that 80 will own one
  • PDAs which is not a huge market with only 15.5
    million out of 108 million users but still an
    idea of what is available for consumers to access
    the Internet
  • In-car navigation systems that use global
    positioning systems to detect vehicles location.
    Also has the ability to search for restaurants by
    name or location
  • Software programs, such as McDonalds Quintillion
    site location, that allow insight into marketable
    areas for expansion

Technological Environment
  • Just in time inventory practices to the fast
    service industry
  • Due to high employee turn-over rates must have
    easy to learn food preparation equipment with
    basic instructions and basically computer
    operated, the ideal is to have zero training
  • Automated equipment that is faster and allows for
    labor cuts, which leads to lower cost of goods
  • some examples being the auto beverage systems and
    bins that cook the fries
  • Food Processing (possible impact on industry?)
  • Using nanotechnology, which is designing food my
    shaping molecules and atoms, is vastly being
    researched and will allow more control and lower
  • As for any company, it is imperative that Wendys
    stay on top of changes in the technological
    environment and even lead the charge in new and
    efficient ways to do business

Natural Environment
Natural Environment
  • Environmental friendliness
  • What type of packaging is best suited to fast
  • Safe for the environment
  • Safe for consumers
  • Is there a way to be more energy efficient
    without having to give up something in the
  • Is the food that restaurants are serving entirely

Fast Food PackagingStyrofoam Containers
  • Advantages
  • Maintains temperature
  • Keeps food fresher longer
  • Food is not soggy
  • Protects food
  • Durability
  • Disadvantages
  • Cant be recycled due to food residue
  • May release harmful products to the atmosphere
    (CFCs or Hydrocarbons)
  • Petroleum based
  • Supply and environmental concern
  • More expensive to manufacture
  • Fills landfills
  • Not biodegradable

Fast Food PackagingPaper Wrappers
  • Disadvantages
  • Cant be recycled due to food residue
  • Not biodegradable due to coating
  • Fills landfills
  • Does not keep food at serving temperature as long
    as foam
  • Advantages
  • Perceived to be better for the environment than
  • Does not damage ozone
  • Compacts better for disposal

Paper WrappersIt Gets Worse
  • Perfluorooctanoic acid (PFOA), which is used to
    make Teflon, is toxic at low levels and is found
    in more than 90 of Americans
  • The use of the Teflon-related chemical could be
    widespread in the fast food industry
  • The CEOs of nine major fast food corporations
    have been asked by an environmental group to
    disclose the use of the chemicals in their

WendysCaring for the Environment?
  • Took ink out of napkins and saves approximately
    56,000 lbs. of waste every year (1996)
  • Changing in packaging of pickles, mustard, and
    mayonnaise removed another 1M lbs. of waste
  • Switching from Kids meal boxes to bags,
    eliminated 1.4M lbs. of waste
  • Ketchup dispensers in restaurants reduced
    individual package waste

FluoroquinolonesDoes your chicken need a shot?
  • Fluoroquinolones - a category of antibiotics that
    includes Cipro - are the drugs of choice to treat
    severe cases of food poisoning
  • In 2000, the FDA proposed banning the use of
    fluoroquinolones in poultry
  • use contributes to increasing numbers of people
    becoming infected with certain antibiotic-resistan
    t bacteria that cause food poisoning
  • Wendys, McDonalds, Popeyes stopped buying
    chicken treated with fluoroquinolones antibiotics
    in 2002

Photovoltaic LightIs Wendys getting enough out
of the sun?
  • Photovoltaic (solar power) lights are used in
    alleys and parking lots in lieu of traditional
    grid-attached lights
  • Lights use batteries at night and can store
    enough energy to power the lights for 5-7 days
    without sun
  • Costs are comparable to traditional lights
  • Parking lots dont have to be torn up to install
    new wiring

Industry SWOT Analysis
  • Caters to fast-paced lifestyle
  • Households with kids tend to buy more fast food
  • Low cost, high volume
  • Fastest drive-thru service in 2004
  • Locations are close to primary competition
  • High entry barriers

  • Because of changing demographics, there will be a
    shift away from fast food towards full-service
  • Market saturation
  • High employee turnover

  • Broaden menus
  • Expansion into breakfast
  • Concentrate on nutrition and taste
  • International growth
  • Expansion into fast casual dining

  • Competition
  • Public perception of fast food
  • Health concerns
  • Changing preferences
  • Emergence of fast casual restaurants
  • Mad Cow disease
  • Frivolous lawsuits e.g. finger, obesity
  • Supersize Me
  • Customer switching cost are low