Publicly traded firm boasting 395 retail stores and over four million dollars in In Winston Salem, North Carolina on JKKD has evolved into a (KKD) is a unique brand offering doughnuts,īeverages, collectibles, and franchise opportunities. What is your conclusion about the industry? Which of the five forces had the most influence on the conclusion? Identify and describe each force as it applies to the industry you chose above. Conduct a brief analysis of the Industry Structure using Porter’s Five Forces Framework. Technology | With the development of online ordering and 24 hours home delivery, it is much easier for people to consume fast food so it provides opportunities for the industry. Life style | The pace of life is increasing people who work in large cities and do not have time to have something big may choose to consume fast food. Health | They might get less consumers in the future because recently more and more people are concerned about their health. Globalization | More and more people from other countries are adopting American culture so there might be opportunities for fast food companies to open new markets. Industry Driving Forces/PEST Analysis: Identify four to five emerging factors in the environment that could have a significant impact on the industry in the future.ĭriving Force | Potential Influence on the Industry | Provide brief answers to the following about this industry. Pick any industry you are familiar with (examples: fast food industry, automotive industry, Personal Computer industry, financial services industry, etc. Fast food firm can gain a competitive advantage by some common ways such as product differentiation, channels of distribution and exploiting the relationship with supplier and customers. The increased presence of different fast food companies means a more competitive market. People can easily image the competitive because there are so many firms are sharing the fast food market. In the world, there are more than 500,000 fast food places. There are close to 50,000 fast food chains across the United States, with McDonalds being the largest restaurant chain. Rivalry among firms: High Threat of Substitutes: HighĬompetition among fast food companies is really high, because there are a lot of competitors and fast food companies all try to again competitive advantage over the other companies in this industry. The 5 force concepts framework is used for analyses the industry rivalry, threat of substitutes, buyer power, supplier’s power and entry barriers. market environment of the fast food industry, evaluates the marketing activities and list several key player such as Panda express, McDonald's and Burger king as examples.
Suppliers are not in a powerful position because there are large amounts of.įast food industry report provide an analysis of the U.S. The bargaining power of suppliers in the fast food industry captures significantly low pressures on the industry’s profitability. While these disadvantages can seem as a significant barrier to entry, the threat of entrants has proven to be high because new players open up hundreds of new restaurants on a daily basis.
Established fast food restaurants have numerous advantages in product technologies, easy access to ingredients and supplies, favorable locations, successful marketing, and experience.
However, the fast food industry is dominated by globally recognized chains with high brand awareness and brand loyalty like McDonald’s, Burger King, KFC, Pizza Hut and etc.
New entrants are not in need to possess proprietary technology to be able to compete with already established restaurants or franchises. Michael Porter’s model discussed below will help us identify five key competitive forces to analyze the fast food industry environment.Įntry barriers into the fast food industry seem to be low because of the relatively low capital requirements to start a new restaurant. Consumers are attracted to the idea of standardized menus and familiar meals in each location. Fast food franchises are known for their low cost and high-speed products served to go as well as for a quick on-site consumption. Porter’s Five Forces Analysis of the Fast Food IndustryĬomplete a Porter's Five Forces Analysis of the fast food industry and for each of the 4 generic strategies, identify one restaurant that you believe is employing that generic strategy.Īccording to Hoover's Fast Food and Quickservice Restaurant Report, Fast food restaurants make up one of the largest food industry segments with more than 200,000 restaurants in the US.