The Cheesecake Factory Incorporated
1. Explain the restaurant's strengths and weaknesses, and justify your explanation.
The Cheesecake Factory Incorporated (TCF) was established in 1972. It currently operates 177 casual dining restaurants under the brand names Grand Lux Cafe, RockSugar Pan Asian Kitchen and The Cheesecake Factory. The company has already signed licensing agreements for expansion in the Middle East and Latin America.
One of the main strengths of TCF is its extensive, innovative and evolving menu (The Cheesecake Factory (TCF), 2013). It has approximately 200 items in its menu which includes appetizers, pizza, seafood, steaks, chicken, burgers, specialty items, pastas, salads, sandwiches, omelets and desserts (TCF, 2013). Because of its broad menu, TCF is able to satisfy the varying dining preferences of its clients during the different dining times. Another strength of TCF is its reputation for serving high quality food at moderate prices (TCF, 2013). They use the freshest ingredients on their bakery products. The chicken they serve are all-natural with no added hormones and their beef are Certified Angus, U.S.D.A. American Style Kobe Wagyu (TCF, 2013). The oils that they use have zero trans fat and the herbs and coffee that they offer are Rainforest Alliance certified, organic and sustainably grown (TCF, 2013). The innovativeness of TCF in terms of its product offerings is evidenced by its new Skinnylicious menu which aims to target the customers who are calorie-conscious and this is what differentiates them from their competitors.
Aside from its products, TCF restaurants are suitably located either in upscale malls or adjacent to it. Their excellent locations, coupled with its casual, high-energy and warm ambiance make eating at their restaurant a great family dining experience. The contemporary interior design, décor and lay-out of TFC’s restaurants contribute to the popularity of their stores.
Topping the list of TCF’s strength is its strong brand name. For the past two years, TCF was named Most Preferred Casual Dining Restaurant based on customer votes by Nation's Restaurant News Consumer Picks. Because of its reputation, TCF relies on word of mouth to promote their restaurant rather than spending on advertisements. Advertising through word of mouth is not a problem for TCF because of its excellent customer service and products. The company puts great emphasis on their recruitment, selection, training and retention programs to ensure the high quality of service in their restaurants .
Like any organization, TCF also has weaknesses that it has to contend with in order to remain competitive. Compared to its competitors, TCF is not as financially and operationally efficient; thus, economies of scale are not yet fully realized. Another weakness is the name of the company itself. Some people have the misconception that TCF only offers cheesecakes and other desserts which are high in sugar and calories. People who are health conscious might be turned off by their name if they are not very familiar with the restaurant especially those in other countries.
2. Identify one (1) way in which the restaurant can utilize its strengths and minimize its weaknesses to be competitive. Explain why you believe this would be effective.
TCF can address their financial weakness by capitalizing on its reputation and strong brand name. It would be easy for TCF to enter into licensing agreements and joint ventures with other companies which are well-capitalized, with reputable business infrastructures and are experienced in managing upscale dining restaurants. In this way, more restaurants can be established both in the US and abroad without putting a drain on the financial condition of TCF. International presence will then be achieved by TCF. These companies though, should share the same values and concepts that TCF has especially with regards to maintaining the high quality of products and service.
With regards to the misconception that TCF only offers desserts and other fattening food products, TCF has already addressed this by capitalizing on their strength. Their innovativeness and periodical review of their product offerings have made them more competitive. The introduction of their Skinnylicious menu is the perfect response to health-conscious customers. They could also tackle the wrong perception on their restaurant by having nutritional information available for clients who want to be more informed. The wide variety of food offerings of TCF would definitely appeal to people from all over the world who have different dining preferences
Opportunities abound for TCF. Since 2011, international expansion has been part of its strategy. The Middle East, Latin America, North Africa, Central and Eastern Europe are some of the regions which it wants to tap. TCF however should be particularly selective in choosing the right partners for the expansion program.
One threat that TCF faces is the effect of the global economic crisis on their sales. The impact of the crisis on the consumers discretionary spending may affect their financial performance negatively. Furthermore, increases in food costs, labor, utilities and other supplies is another threat that TCF has to confront. The stiff competition in the restaurant industry is another major concern of TCF.
Despite the weaknesses and threats that TCF possess and encounter, the company does not lose its focus and instead draw on its strengths to be able to cope with any challenge that may beset them. Their commitment to high quality products and service will help them achieve their goal of becoming a global restaurant known for its excellent upscale casual dining experience.
References
Kraft, A. (2013, July 2). Dig in to this "penny" stock: A SWOT analysis. Retrieved from beta.fool.com: http://beta.fool.com/leglamp/2013/07/02/dig-in-to-this-penny-stocka-swot-analysis/39141/
The Cheesecake Factory. (2013, October 23). Investor relations. Retrieved from investors.thecheesecakefactory.com: http://investors.thecheesecakefactory.com/phoenix.zhtml?c=109258&p=irol-IRHome
The Cheesecake Factory Incorporated. (2013, January). Form 10-K- The Cheesecake Factory Incorporated. Retrieved from secfilings.nasdaq.com : http://secfilings.nasdaq.com/edgar_conv_html%2f2013%2f02%2f28%2f0001104659-13-016153.html#FIS_BUSINESS
Yahoo, Inc. (2013, October 24). The Cheesecake Factory Incorporated - Profile. Retrieved from finance.yahoo.com: http://finance.yahoo.com/q/pr?s=CAKE+Profile
