Taco Bell is a fast-food chain restaurant that is based in Irvine in California, United States. Its products include Yum Brands and also serve the variety of foods that include burritos, tacos, nachos, and quesadillas among others. It serves more than two billion customers with the target ones being the youths of between eighteen and twenty-four year in more than six thousand five hundred restaurants. Eighty percent of these restaurants are operated by independent franchisees that have reduced the company's cost of operation. Taco Bell's profits have been improving drastically from the year 2010; however, it faces some of the external factor such as competition and buyers change behavior.
The customers of this company had been loyal to the company and its product, and the restaurants were open for them from dawn until midnight every day. However, their buying behavior changed in 2011 when there was a lawsuit concerning the company's line of product. The allegation was that the restaurant's seasoned meat was not real meat, but it was mostly fillers (Gandellini, Pezzi & Venanzi, 2012, p.45). The accusation affected the perception of the customer regarding the brand. That time the sales dropped by 1.4 percent that made the company contest that claim. The company later reclaimed its position after withdrawing the case.
The other external factor that affects the company's performance is competition. Other firms produce some lines of products that are almost similar to Taco Bell's ones. Those firms include Pizza Hut, McDonald's, Kentucky fried chicken (KFC), Domino's, and Subway among others. KFC, for instance, is a threat to Taco because it produces some similar products with popular brand name and loyalty. It also produces a high number of products, hygienic food, and quick service (Calkins & Darrell, 2016). Also, it has a well-established marketing strategy that includes the advertisement. The rest of the competitors also have well-developed product lines, loyal customers, strong marketing strategies and strong brands' names. All the above competitors produce their products for almost the same target consumers.
Political, economic, social, and technological (PEST) are also some external factors that influence Taco Bell company. When the issue of the fillings of the meat ensued, it raised some political attention, and the company had to respond to a lawsuit to defend itself and its existence in the market. Economically, the restaurant has to take the purchasing power of its target customers (the youths) into consideration (Gandellini, Pezzi & Venanzi, 2012, p.67). They, therefore, had to produce their lines of products that are of good quality but with low prices for their affordability. The company also has to consider social responsibility for it to have motivated and loyal customers. It produces the products according to various social classes of customers for prestige and customers' comfort (External environment and business confidence n.d.). Technology, on the other hand, is one of the important factors for a company to excel. Taco Bell restaurants had to come up with modern technology for their customers and for it to remain competitive. It created an application that allows customers to place orders for their burritos and other Yum brands. It is an e-commerce that allows customers to make transaction online that has enhanced quick services in its restaurants.
Jason Bonnar should continue in the expansion of the breakfast and the Doritos Locos Tacos because the company has its competitive advantage in the lines of products. It has less competition in the breakfast and the tacos lines (Gandellini, Pezzi & Venanzi, 2012, p.81). The tacos products also enable the company to use the most efficient and technologically advance method of marketing. Therefore, Jason should consider expansion of both for the company's competitiveness and profitability.
References
Calkins, T., & Darrell, B. (2016). Taco Bell: The Breakfast Opportunity. doi:10.4135/9781473972223
External environment and business confidence. (n.d.). doi:10.1787/888932767688
Gandellini, G., Pezzi, A., & Venanzi, D. (2012). External and Internal Analysis of the Environment. SpringerBriefs in Business, 45-84. doi:10.1007/978-88-470-2487-8_2
