A case study on sizzlers

Date

2010

Degree

Bachelor of Science in Agribusiness Management

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Agnes T. Banzon

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Abstract

The Restaurants sector includes places that offer food and beverages. In Los Baños, specifically the area near the UPLB campus, the food service industry is faced with increasing, fierce competition. However, the locality is also home to tourist destinations which have the potential to open an opportunity for the industry participants. Hence, there is a need to conduct a case study on a restaurant to improve its operations and thus its profitability.

The study sought to describe a major business issue faced by Sizzlers, a 17-year- old restaurant located along F.O. Santos Street, Grove, College, Laguna. The effect of the

said issue on the different business functions was also described. The case study approach was utilized and supplemented with SWOT analysis and financial analysis. The recommendation was based upon the matching process of the firm’s internal strengths and weaknesses against the external opportunities and threats that prevail. The method used in collecting primary data was through personal interview. Physical observation was conducted to be familiar with the operations of the restaurant. Secondary data were obtained from books, online sources, and journals. The industry scenario was analyzed using SWOT analysis (strength, weaknesses, opportunities, threats) while Porter’s framework was used in determining the competitive status of the firm. The assessment of the present strategies of Sizzlers was done through observations of the business operation and interviews with the owner, the employees, and fifty regular customers. The strengths of the firm were identified as follows: Sizzlers has been in the food service industry for seventeen years and is still making profits, site is accessible/near the market, owner is born and raised in Los Baños and has a wide network of connections, the size of the restaurant is bigger and the overall design of the place is more appealing compared to its indirect competitors, accommodating and pleasant staff, and good quality products. On the other hand, the weaknesses were: vague market positioning, high prices of products relative to actual competitors, understaffed during the night, no promotional activities, and the owner could not attend full-time to restaurant concerns. A major opportunity open to the firm is that Los Baños is home to the University of the Philippines, Los Baños and to other research and development institutions. The town is highly attractive to tourists. Communication media and financial intermediaries could also be utilized effectively. On the other hand, threats include the following: increasing competition, “ghost town” seasons or Los Baños’ characteristic seasonality, and the further aggravation of the economic status in Los Baños. Based on the analysis, the problem faced by Sizzlers is its declining return on investment. The prices remain stable because of the threat of losing customers to competitors who could offer cheaper products while costs increase. This is of course also because of the accumulated problems across the functional areas.

Matching the internal strengths and weaknesses to the external opportunities and threats, the researcher came up with three alternatives to address the problem. First, Sizzlers could strengthen its existing strategy but instead of catering to students in general, Sizzlers will focus on the upper bracket students who could spend at least P75 on a meal. Second, the firm could engage in institutional tie-ups and the hiring of a manager. And third, the owner of Sizzlers could opt to decrease the size of the restaurant and then utilize the extra space for another income generating enterprise. Using the preference matrix criteria including the acceptability of the alternative to the owner, profitability, degree of risk, cost of implementation, and the length of time to implement the alternative, the three alternatives were evaluated. The highest and most favorable alternative chosen was for Sizzlers to strengthen its existing strategy and cater to the upper bracket students who could spend at least P75 on a meal. Under this alternative, the owner would once again have her focus directed entirely on the management activities of the restaurant, an additional staff member will be added to answer the problem on inefficient service, new products unique to Sizzlers will be introduced, the pricing on the menu will be revised, and most importantly, the firm will take aggressive promotional activities which will include the loyalty card, and the movie and open microphone nights.

Language

English

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993 2010 M17 R36

Document Type

Thesis

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