part of the final paper (Business strategy)

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timer Asked: Oct 17th, 2018
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Question Description

you should analyze the company of the Chipotle Mexican Grill. you should open the document of "MBA6611 Paper Template Summer " first, and write the question 5 and question 6. but when you do the question 5 and 6, you have to read the "Chipotle Question 3 et 4.docx" first. The "Chipotle Question 3 et 4.docx" include the strengths, weakness, opportunity, threats (SWOT). According the SWOT, you can write the question 5 and 6.

you should write 3500 words, and use APA format. Do not plagiarism!

I have some reference for the paper, you can use it!

https://www.linkedin.com/pulse/strategic-analysis-chipotle-mexican-grill-amanda-mann/

https://sites.google.com/site/chipotleanalysis/external-analysis-of-chipotle

http://fernfortuniversity.com/term-papers/pestel/nyse4/2666-chipotle-mexican-grill--inc-.php


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Business Strategy Business Strategy 1. SPACING: The assignment should be double-spaced. The “Reference” section should be single-spaced with double spacing between entries. 2. FONT SIZE: Use Times Roman 12-point font. 3. FORMAT: Number all pages (bottom of page), and indent new paragraphs 5 spaces. Use the APA writing style to properly cite and reference all research material. 4. LENGTH: The body of the paper (Introduction to Conclusion) cannot exceed 30 pages. 5. RESEARCH: Effective research references many sources. (Use sources less than or equal to 10 years old.) Some basic references include the following: a. b. c. d. e. f. Your textbook Finance.yahoo.com and MSNmoney.com Hoovers.com The company’s website Small Business Administration (www.sba.gov) Wikipedia’s references or sources (NOT Wikipedia) 6. INSTRUCTION PAGE: You must delete the instruction page; that is, the title page is the first page of the report. “Company Name” Case Analysis Page 1 of 21 Business Strategy COMPANY NAME (Case Analysis) Group #--Section # Specialist A Specialist B Specialist C Specialist D Specialist E Specialist F Presentation Date “Company Name” Case Analysis Page 2 of 21 Business Strategy SPECIALIST ASSIGNMENT Introduction…………………………………………………………...…………..Specialist #1 Question 1……………………………………………………...………………….Specialist #1 Question 2 (Financial Matrices)……………………………………….………….Specialist #2 Question 3…………………………………………………………...…………….Specialist #3 Question 4…………………………………………………………...…………….Specialist #4 Question 5 (SWOT & GS Matrices)……………………………………..……….Specialist #5 Question 6a&b………………………………………….…………...…………….Specialist #5 Question 6c (Pro forma Statements).…………………………..…...…………….Specialist #6 Question 7…………………………………………………………...…………….Specialist #6 Update & Conclusion…………………………………………….……………….Specialist #6 INTRODUCTION State your intentions/plans for the paper. Give an overview of the paper, and indicate the year of your case. You should provide a brief company history as well as an industry summary. The industry analysis should include a discussion of the industry’s total revenue, compound annual growth rate, major product categories, and competitors. (The CAGR is needed to position the company in the Grand Strategy Matrix.) “Company Name” Case Analysis Page 3 of 21 Business Strategy CASE ANALYSIS Question 1: Identify the firm’s apparent current mission. Then briefly review the firm’s current objectives and strategies. [Please note that you must evaluate the firm’s mission statement.] Mission Statement: Mission Statement Evaluation: Component 1 2 3 4 5 6 Company Company Objectives: Company Strategies: “Company Name” Case Analysis Page 4 of 21 7 8 9 Business Strategy Question 2: How would you describe the firm’s current financial condition? [Use financial ratios and other pertinent income and balance sheet data to support your analysis.] Historical Financial Analysis: [You must explain the trends in each of the five categories—liquidity ratios, asset utilization ratios, leverage ratios, profitability ratios, and market ratios. Use the end points for your assessment of the period.] Competitor Financial Analysis: [You must explain your company’s positioning in each of the five categories—liquidity ratios, asset utilization ratios, leverage ratios, profitability ratios, and market ratios.] Overall Financial Health or Evaluation: “Company Name” Case Analysis Page 5 of 21 Business Strategy Question 3: Outline and discuss the firm’s external opportunities and threats, using any analytical model(s) you believe are relevant. [You must analyze the General Environment, Industry Environment, and the firm’s strategic group to determine this information.] “Company Name” Case Analysis Page 6 of 21 Business Strategy Question 4: Outline and discuss the firm’s internal strengths and weaknesses using any analytical model(s) you believe are relevant. [Strengths and weaknesses will include information from the financial analysis.] “Company Name” Case Analysis Page 7 of 21 Business Strategy Question 5: Based on your analysis: a. Identify problem. (Internal and external) (according to the SWOT, question3,and 4) I will give you answer of 3 and 4. b. Revise the firm’s mission and objectives if necessary. c. Develop and discuss corporate and business strategies that you recommend to achieve the firm’s mission and objectives. d. Select strategy (three strategy from Alternative strategies) I will show you what is Alternative strategies by the word document. e. Evaluate strategy Mission and Objective Revisions: Alternative Solutions or Strategies: [Your SWOT Matrix should contain your final selection of strategies; that is, you must integrate the “desired” strategies from the Grand Strategy Matrix. You will discuss in detail the top three strategies in this section.] Strategy 1: [Identify the strategy and discuss how it will solve the company’s problems or help it reach its goals.] Strategy 2: [Identify the strategy and discuss how it will solve the company’s problems or help it reach its goals.] Strategy3: [Identify the strategy and discuss how it will solve the company’s problems or help it reach its goals.] “Company Name” Case Analysis Page 8 of 21 Business Strategy “Company Name” Case Analysis Page 9 of 21 Business Strategy Question 6: Outline and discuss the specific actions needed for implementation of your chosen strategy. This should include the following: a. Specific strategies and long-term objectives in such areas as marketing, human resources, finance, operations, and information systems as appropriate. b. Specify specific annual objectives and the policies for achieving these objectives, in areas such as marketing, human resources, finance, operations, and information systems as appropriate. Recommended Strategy: [You must choose “one” strategy to implement.] Implementation of Selected Strategy: a. Management: b. Marketing: c. Operations: d. Accounting/Finance: e. Research & Development: “Company Name” Case Analysis Page 10 of 21 Business Strategy Question 7: Recommend procedures for strategy review and evaluation. Include specific measures that you will utilize. Projected Financial Ratios: [Discuss the impact of the selected strategy.] Balanced Scorecard: [You must list the important annual objectives necessary to achieve the firm’s long-term goals.] Rumelt’s Criteria: [Evaluate the selected strategy relative to Rumelt’s Criteria.] “Company Name” Case Analysis Page 11 of 21 Business Strategy UPDATE What has happened since the case was written? (Note: If this is a real-time case, this section is omitted.) CONCLUSION Provide a summary. Overall, what do you think about the company? “Company Name” Case Analysis Page 12 of 21 Business Strategy REFERENCES David, F.R. (2005). Strategic management: Concepts and cases (10e). Upper Saddle River, New Jersey: Pearson-Prentice Hall. MBA Comprehensive Questions. (2002). Sorrell College of Business, Troy University. (Add additional research sources to this list, and list the sources in alphabetical and chronological order using the APA format!) “Company Name” Case Analysis Page 13 of 21 Business Strategy APPENDIX A: FINANCIAL RATIOS “Company Name” Case Analysis Page 14 of 21 Business Strategy Financial Ratios: Historical Comparison Case Year-2 Case Year-1 Case Year Assessment Liquidity Ratios Current Ratio Quick Ratio Asset Utilization Ratios Inventory Turnover DSI AR Turnover DSO (ACP) Fixed Asset Turnover Total Asset Turnover Debt Management Ratios Debt Ratio TIE Profitability Ratios Gross Margin Operating Margin Profit Margin BEP ROA ROE Market Ratios P/E P/CF M/B Assessment Notation: P=Positive Trend, N=Negative Trend, Dash=No Change. “Company Name” Case Analysis Page 15 of 21 Business Strategy Financial Ratios: Competitor Comparison Company Competitor Case Year Competitor Industry Liquidity Ratios Current Ratio Quick Ratio Asset Utilization Ratios Inventory Turnover DSI AR Turnover DSO (ACP) Fixed Asset Turnover Total Asset Turnover Debt Management Ratios Debt Ratio TIE Profitability Ratios Gross Margin Operating Margin Profit Margin BEP ROA ROE Market Ratios P/E P/CF M/B Assessment Notation: S=Strength, W=Weakness, Dash=Neutral. “Company Name” Case Analysis Page 16 of 21 Assessment Business Strategy APPENDIX B: STRATEGIC MATRICES “Company Name” Case Analysis Page 17 of 21 Business Strategy SWOT MATRIX Strengths SWOT MATRIX Your Company Weaknesses 1 2 3 4 5 1 2 3 4 5 1 2 1 2 1 2 1 2 Opportunities 1 2 3 4 5 Threats 1 2 3 4 5 “Company Name” Case Analysis Page 18 of 21 Business Strategy GRAND STRATEGY MATRIX (David, 2005) RAPID MARKET GROWTH Quadrant II Quadrant I Your Company (Example) WEAK COMPETITIVE POSITION STRONG COMPETITIVE POSITION Quadrant III Quadrant IV SLOW MARKET GROWTH “Company Name” Case Analysis Page 19 of 21 Business Strategy APPENDIX C: PRO-FORMA STATEMENTS “Company Name” Case Analysis Page 20 of 21 Business Strategy APPENDIX D: EXTRA CREDIT MATRICES EFE Matrix CP Matrix IFE Matrix QSPM Matrix “Company Name” Case Analysis Page 21 of 21 Strategy David, Fred R. Strategic Management: Concepts and Cases (10e). Upper Saddle River, New Jersey: Pearson-Prentice Hall. ALTERNATIVE STRATEGIES 1. Integration Strategies i. Forward integration: Seeking ownership/control over distributors or retailers. ii. Backward integration: Seeking ownership/control over suppliers. iii. Horizontal integration. Seeking ownership/control over competitors. 2. Intensive Strategies i. Market penetration: Seeking to increase sales (market share) for present products and services in present markets via greater marketing efforts. ii. Market development: Seeking to increase sales by introducing present products and services into new geographic areas (geographic expansion). iii. Product development: Seeking to increase sales by improving present products or services or developing new ones. 3. Diversification Strategies i. Concentric diversification: Developing new, related products or services. ii. Conglomerate diversification: Developing new, unrelated products or services. iii. Horizontal diversification: Developing new, unrelated products or services for present customers. 4. Defensive Strategies i. Retrenchment: Restructuring via cost and asset reductions to reverse declining sales and profits. ii. Divestiture: Restructuring by selling a division or part of an organization. iii. Liquidation. Closing the business by selling all of a company’s assets for their tangible worth. 5. Combination strategy https://www.swotandpestle.com/chipotle-mexican-grill/ Question 3: Outline and discuss the firm’s external opportunities and threats, using any analytical model(s) you believe are relevant. [You must analyze the General Environment, Industry Environment, and the firm’s strategic group to determine this information.] https://www.linkedin.com/pulse/strategic-analysis-chipotle-mexican-grill-amanda-mann/ https://sites.google.com/site/chipotleanalysis/external-analysis-of-chipotle http://fernfortuniversity.com/term-papers/pestel/nyse4/2666-chipotle-mexican-grill--inc.php Chipotle Mexican Grill (CMG) external opportunities and threats are examined through the general environment (Pestel Analysis), industry environment (defined by the United State Bureau as a limited restaurant), and strategic groups (unique brand and food) attending to expand its strategy with new business hours and more option in the menu. Porter’s five forces provide an analysis of developing strategies. CMG is strong in the bargaining power of buyers (the buyers do not drive prices down), the threat of substitute products (Consumers have many options including eating at restaurant or eating at home), and rivalry among existing firms (The pure number of other options to dining offers so many alternatives to Chipotle such as Moe’s, Qboda, or Panera Bread). Bargaining Power of Suppliers is moderate because there were few producers (There are multiple channels in which Chipotle could receive its products, but there are fewer organic suppliers). The threat of new entrant of Chipotle restaurant is relatively moderate too even though it may be justly and fair easy for an individual into a national franchise (the market is already saturated with many alternatives to Chipotle). There are five external opportunities and threats for CMG to consider. Opportunities: New Product Categories: Chipotle essentially has four product categories at its restaurants: burritos, tacos, burrito bowls (a burrito without the tortilla), and salads. The company could introduce other product categories to its menu, focusing on other Mexican offerings that could expand sales. The company can also grow its non-Mexican offerings through its ShopHouse Southeast Asian Kitchen and Pizzeria Locale restaurants. It currently has fewer than 20 of these restaurants, and could greatly expand these if they continue to perform well. Store Expansion: As we mentioned earlier, the company plans on opening between 220 and 235 stores this year, the vast majority of which will be in the U.S. Chipotle still has a long way to go to approach the level of McDonald’s (MCD – Free McDonald’s Stock Report), which has more than 35,000 restaurants domestically. Chipotle has also not yet tapped into the international markets, aside from a few restaurants in Canada and a handful in Europe. Both Canada and Europe offer a large, mostly untapped market with a high percentage of consumers who have high disposable income. The company could also expand into emerging markets, particularly in Asia, where Mexican dining options are few and far between. Other companies that have expanded internationally, including McDonald’s and KFC, have had great success in international markets. Focus on international expansion: Chipotle has rapidly expanded in the last 10 years and has entered the European market as well. This opens up great opportunities for Chipotle to expand in Europe and explore other countries as well. Social Media: Chipotle has a consistent presence across Facebook, Twitter, YouTube, Pinterest, LinkedIn, and Instagram. They have a singular visual identity and extend similar branding across networks. It also allows the customers to be up to date on the latest products of CMG. Franchising: CMG continues to expand operations but franchising is a good opportunity for CMG to use. This will allow CMG to become one of the top leading franchising companies which allow for growth. Threats: Intense Competition and number of fast food restarants offering healthy meals: The Company faces fierce competition from various multinational as well as local food outlets. This forces the company to keep improving its food quality, ambience, reputation etc. to stay ahead of the competition. Competition: The fast-casual, quick-service dining industry remains highly competitive with respect to price, quality, service, and convenience. Primary competitors include locally owned restaurants, as well as national and regional chains. Many of these companies have existed for far longer than Chipotle, and many have a more established market presence. Some also offer menu items that are diet friendly, or low in carbohydrates, while others emphasize lower-cost, “value meals”, a strategy that the company is not currently pursuing. Primary competitors include Taco Bell, which is owned by Yum! Brands (YUM), McDonald’s, and Panera Bread (PNRA). Increase in food safety regulations: The industry is subjected to various food safety regulations in various countries in which Chipotle is present. This increases company’s compliance cost and hence affects operating margins. Also, any further changes in food safety laws can affect the industry. Additional Food Safety Issues: While it will likely take some time for Chipotle to regain the trust of customers, any additional instances of food-borne illnesses could considerably, and maybe permanently, decimate customer perceptions of the quality of Chipotle’s food items. As we have already mentioned, management has taken significant steps to improve its food safety, beyond industry standards. As a result, we don’t anticipate any more problems in the future. While it’s impossible to prevent every instance of food-borne illness, we think the company is doing everything in its power to prevent further relapses in safety and quality. Economy: CMG continues to expand domestically and internationally which is affected by the economy. Expansion causes CMG to grow and add more employment opportunities. As CMG continues to expand, the long-term debt increases which mean loans are being taken out. The interest rates fluctuate which affect the amount of loan repayment. The foreign exchange rate plans a huge role for CMG. CMG is targeting the international market, which impacts the goods and services transported overseas. Inflation and high unemployment around the world plays a factor in the consumer’s purchases resulting in a reduction in consumer spending. Consumers tend to purchase when inflation is low. This had a significant effect on the limited service restaurant market segment. Bargaining power of Buyers : Bargaining power of buyers is generally related to the functions of supply and demand variables. It is about the capability of the buyer to purchase a similar product with a similar price and even any associated switching cost. For instance, a buyer can buy a burger from McDonald or Burger King which is can also cost the same price with a similar food. Thus, based on the previous result, one could be conclude that the bargaining power of buyers in the industry should be relatively high. Besides, the argument could be made that the bargaining power of buyers is ultimately based on their collective ability to place pricing pressure on the industry. As previously discussed, the industry menu prices have consistently increased over the years inferring that buyers have not affected the prices in their favor. Buyers in the fast food industry consist of individual consumers and although their combined size very huge, they do not make any purchases collectively. It seems like unwilling to change. Threat of new entrants : The threat of new entrant of Chipotle restaurant is relatively low even though it may be justly and fair easy for an individual into a national franchise. The creation of a new national chain is quite a huge effort because it requires a significant financial resources and industry specific knowledge to enter the industry at a relevant scale. Moreover, the successful of the fast casual concept and an attractive overall industry spread, the future may bring a new entrant into the industry as well. A number of national casual restaurant chains and fine dining restaurants have been creating fast casual spinoffs of their brands to compete in this segment of the industry. Thereby, this threat of new entrants from the established firms within the overall restaurant industry presents a significant threat. These companies have both accesses to the required capital and the knowledge required for expand speedily on a national level. Threat of losing Customers : The Denver-based burrito chain, which is currently looking for a new CEO, said on Tuesday ...
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Tutor Answer

Chancellor_Ivy
School: UIUC

Attached.

Running head: BUSINESS STRATEGY

CHIPOTLE MEXICAN GRILL
Strategy Development

Group #--Section #
Specialist A
Specialist B
Specialist C
Specialist D
Specialist E
Specialist F
Presentation Date

1

BUSINESS STRATEGY
Strategy Development for Chipotle Mexican Grill
Introduction
Chipotle Mexican Grill is one of the fastest growing chains of restaurants in the United
States. The organization that has been in existence for about twenty five years has managed year
on year growth in sales due to its insistence on technology adoption. In the recent past, the firm
has faced a number of internal and external challenges that hinder productivity. Recently, the
firm has been on the limelight for the E.Coli bacteria that caused the illness of various customers
leading to decreased sales. Other problems include high costs of commodities, limited items on
the menu, rising competition from similar firms in the market and limited marketing campaigns.
These problems have affected the company’s financial position and also created a negative
image for the firm and in turn led to reduced revenues, profits and market share. The
organization can however, adopt diversification strategies that will help to reach to more
customers so that they can increase their overall productivity.
Question 5
a. Analysis of Internal and external problems facing Chipotle Mexican grill
Chipotle Mexican Grill is one of the leading chains of restaurants across the United States.
The organization that takes pride in its specially designed Mexican foods like burritos however
has not had it easy in the market. Using a SWOT analysis, policymakers can determine the
internal problems facing the company so that they can design appropriate policies to address the
issues. One of the issues that the company faces is the limited items in their menu which
minimize the amount of money that their clients spend. Chipotle Mexican Grill is widely known
for their burritos and other few products like salads and tacos. Even though many people still

2

BUSINESS STRATEGY
consider visiting the restaurant for their high quality products, the limited product offerings cause
clients to stick to only a few products while they could spend more if the restaurant added more
items on their list. Another problem facing Chipotle Mexican grill is the high prices of their
foods. Well, the restaurant specializes in specially designed Mexican foods that are of high
quality. However, this quality comes with high rates of these commodities. The costs, therefore,
limit the products to the upper class so that there are no commodities for the customers who
prefer cheaper alternatives. Another problem facing Chipotle Mexican Grill is the quality of
ingredients. While the restaurant boasts of using natural ingredients in their food, the incidences
of disease outbreaks related to salmonella, E.Coli and norovirus back in 2015 have raised a lot of
questions on the issue of quality (Debter, 2017). Recently, Chipotle Mexican Grill’s outlet in
Ohio received approximately 700 cases of food poisoning. However, specialists in food
microbiology reported that the bacteria that presented itself in the food could have been caused
by food that was left in unsafe temperatures; not too hot and not too cold after preparation
(Fickenscher, 2018). This has now forced the restaurant to incur more costs of retraining
employees on food handling standards to promote the health of the clients.
Chipotle Mexican Grill also faces the problem of limited campaigns to attract customers.
Even though the company continues to attract significant number of clients, it has done very little
effort to inform clients of their commodities. Until recently, the restaurant had not conducted a
significant campaign on its products on national television (Finney, 2018). This limits the
number of clients that could visit the organization due to inadequate information. Furthermore,
the restaurant is slowly losing its clients due to the long queues at the facility. Customers,
therefore, prefer driving to other restaurants instead of wasting their time at the long lines
facilitated by slow customer service attendants who sometimes do not play clients’ instructions

3

BUSINESS STRATEGY
causing them to take more time in service. Chipotle Mexican Grill continues to face problems
with the supply chain. The organization stopped offering pork in their menu because there was
reduced supply of the meat. This followed the company’s termination of contract with a supplier
who did not meet the quality requirements for meat that require no chemical additives to the
products. However, the facility resumed pork sales after they found a British supplier. The final
problem with the organization’s internal environment is the fact that all of their locations are
corporately owned (Ho, Liang, Chan & Ma, 2014). This means that the firm offers no franchise
opportunities for willing partners. The strategy, therefore, continues to limit diversification of the
menu while restricting expansion to other parts of the country. These internal problems facing
Chipotle Mexican Grill hinder performance, and the firm, therefore, needs to design policies that
address these problem...

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Anonymous
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