White : Dairy Queen (DQ) - Research Paper Example

? White Paper al Affiliation Introduction Dairy Queen (DQ) is one of the most famous American brands. Its integration as a fast food chain with a wide range of quality products together with nationwide presence are what gives it its pride and recognition. Miami, which is one of the major states in which Dairy Queen operates has shortcomings with respect to the company’s activities. Characterised by the hot weather all year round and the huge number of visitors, the number of food stores held by Dairy Queen and the extent of advertising in the state is quite low. The four stores in Miami are not sufficient to meet the high demand of ice cream and to provide substantial competition to local vendors. In addition to the shortage of vending stores in Miami, DQ has a weak hand in advertising the brand in the state. The marketing and advertising models used by the company are ineffective in terms of coverage and catchy content to draw the attention of existing and potential customers. Coupled together, this two shortfalls are likely to lead to reduced revenues and impede growth of the brand in the long run. Miami, however, presents itself as a good opportunity for the company to take advantage. As earlier mentioned, the hot weather all year round and the constant presence of visitors are an excellent opportunity for the company to tap. With this respect, I would propose expansion into the state by opening more stores to meet the high demand present of chilled dairy products and other assortment of fast food. Further, DQ should put more focus in their advertisement and marketing strategies in order to get expand their customer base as they expand their physical presence. Paradigm The problem that DQ faces in Miami can be addressed in a simple, efficient and cost effective way. Capitalising on factors that give Dairy Queen competitive advantage such as the good customer service system at their stores, good customer base and the excellent food offered would play a big role in facilitating the strategic plan to cover the shortcomings (Hitt et al. 2013). Strategic expansion of Dairy queen in Miami is a feasible plan to cover for the problem already present in the state. Prior to the implementation of any strategic expansion of the company, I conducted a thorough research that details the key problems to be addressed, a SWOT analysis of the internal and external environment of DQ and proper strategies to implement the changes. Problems The main problem facing DQ in Miami is the shortage of stores in the state. There are only four DQ stores that are serving the whole of Miami and this limits the number of customers targeted. In addition to a low number of stores, the general operational activities of the stores are not competitive enough to tap into newer markets and attract new customers. Taking into account the operational pitfall of each of the stores, it can be observed that; among the four stores, there is only one which opens in the morning while all the rest open in the afternoon hence cannot offer breakfast. Two of the stores lack a drive through facility hence customers have to consider parking problems when visiting the stores. In terms of incentive to the customers, most of the stores do not have gift cards for their customers and they also lack delivery services for orders made to the store nearby. In addition, there is a location problem as the company does not have beach stores which have high buying needs and high customer traffic. SWOT analysis The SWOT analysis provides a brief insight on the strengths, weaknesses, opportunities and threats face by the company. DQ should capitalise on their strengths and opportunities while keeping the weaknesses and threats at a minimum in order to successfully expand. Strengths: Miami is a city with relatively hot weather all year round which favours the demand for ice cream and other cold beverages which is a speciality for DQ. In addition the quality and variety of the food offered is excellent and the customer service is exemplary. Weaknesses: DQ lacks proper and effective advertising strategies to reach the customers. The shortage of convenience stores located in Miami coupled with the lack of breakfast and morning service in most of the stores is also a weakness in DQ. Opportunities: DQ can extend its stores in the downtown district and provide different promotional activities. The company can also open a beach store to tap into that market whose demand for cold beverages is high. Threats: the major threat faced by DQ is competition. Other opponents such as McDonalds and Starbucks pose stiff competition for the market. Strategies Following the problems identified with Dairy Queen in Miami, obtaining lasting solutions needs proper strategic plans. Some of the strategies that can be implemented in order to bring about a paradigm shift in the scale of operations include putting more effort on marketing and advertising and implementing an overhaul in the operating activities of the company. Dairy Queen has put less emphasis on marketing and advertising before. This has been responsible for a general decline in customers and an underutilisation of the potential that it has to generate revenue. Implementation of a new models of advertisement would be a core inclusion of the strategic expansion (Sekhar, 2004). Dairy Queen should benefit more promotions and advertisements and it would be exemplified in the sales volumes and subsequent revenues. The company needs to also invest in customer satisfaction as this is the major factor in determining the success (Thompson & Martin, 2005). With this respect, employee training on customer relational skills should be provided to employees. This would enhance personal contact with the employees and give them more reason to have loyalty to the brand. In addition to training, DQ should provide drive through services in its stores and also any delivery services to areas near the store of necessary. It should also flex the working hours and model its product range to also fit the morning hour so as to increase the variety of customers depending on their preference. In relation to customers, DQ should also be able to satisfy a wide variety of customers by having facilities such as children’s playground if they have available space in any of their stores to cater for families with children for example. As much as it is an iconic brand in the American market, DQ should also strive to maintain its image. As the customers and the environment in which the company operate are what give it the capability to exist. Dairy Queen should participate in charitable activities which would give back to the society and build the company’s reputation. This would have a positive effect on customer loyalty and thus improve on customer loyalty (Enz, 2010). In expanding, Dairy Queen should put much consideration on strategic location. The company should expand and set up shop in areas with high demand for their product (Kozami, 2005), this would include areas such as the beach and in the downtown district. Amidst the expansion strategy, Dairy should set up short term and long term goals to enable them assess the extent to which the expansion strategy is meeting the set objectives. The benefit gained by DQ from implementing the expansion strategy would be greater in the long run. A cost-benefit analysis of the strategic expansion together with the promotional activities would show a considerable capital investment initially but this will be supplemented by the increasing revenues which result. The implementation process would last over a short time period, roughly 6-12 months with an aggregate total cost of approximately $ 1,000,000. This can be returned in a period of 1-2 years. References Enz, C. A. (2010). Hospitality strategic management: Concepts and cases. Hoboken, N.J: John Wiley & Sons. Hitt, M. A., Hoskisson, R. E., & Ireland, R. D. (2013). Strategic management: Competitiveness & globalization : cases. Mason, OH: South-Western, Cengage Learning. Kozami, A. (2005). Business policy and strategic management. New-Delhi: McGraw-Hill Published. Sekhar, G. V. S. (2004). Business policy and strategic management. S.l.: I K International Publi Thompson, J. L., & Martin, F. (2005). Strategic management: Awareness and change. London [u.a.: Thomson Learning. . 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