The business environment of Radix Fried Chicken

The objectives of doing report is to review and understand the complete business environment better, to use our knowledge of management of strategy in a real business environment by analysing the general environment and using the correct strategies in a business situation. Besides that, this survey is also finished with the motive of guiding RFC in the management of the business.

1. 3 Scope of Report

This report covers the background of the organisation, situation analysis, strategic options for the organisation, key selection requirements and tips for the company.

1. 4 Limitations of Report

This report might not exactly be totally credible and may not be very complete. This is because of the fact that we have a problem obtaining information and information on Radix Fried Rooster as the information we gather online is bound and our interviewee, who is the supervisor of Mydin MITC's RFC branch, cannot answer almost all of our questions with eloquence and could not provide us with the facts we needed. Furthermore, certain parts of our statement are written predicated on our observations, knowledge, understanding and analysis.

2. 0 Qualifications of Organization

Radix Fried Chicken (RFC) was proven by Tuan Haji Ismail on the 26th of May 2008. The first RFC branch, which was exposed in Lagenda Heights, Sungai Petani, Kedah, began its procedures on 1st June 2008. The opening of RFC is 100 percent owned by Islamic Bumiputeras.

RFC is one of the subsidiary companies under HPA establishments Sdn Bhd which is a fast-food established concept restaurant predicated on the Islam Syari'ah law. All requirement areas of the Syari'ah ensure RFC's quality from its safe-keeping of raw materials, its halal quality and sanitation.

The management and procedures facet of RFC procedures the ethical main of Islamic staff such as Muslim culture and willpower; and also the practice of praying before the beginning of each morning.

In the existing situation, the market and demand for fast-food is high. It really is found that the fast-food concept market in this country is monopolized by the non-Islam community and 90 percent of their brands originated from abroad. Upon the realization and responsibility how important halal food choices are, RFC is established to give halal food alternatives to Islam people, especially Islam people in Malaysia. Together with the opening of the first restaurant in Sungai Petani, RFC is determined to open 400 more restaurants in the complete of Malaysia.

3. 0 Situation Analysis

3. 1 Basic Environment Analysis

General environment is the factors and conditions made up of measurements in the broader contemporary society that influence an industry and the companies within it. These measurements are grouped into seven environmental segments, that are demographic, economic, political/ legal, sociocultural, technical, global and physical environment.

1) Demographic

Demographics or demographic data will be the characteristics of human being in a population. Demographic trends summarize the changes in demographics in a people over time. Both distributions and fads of values inside a demographic adjustable are of interest. The target market of Radix Fried Rooster is fast food enthusiasts and their aim for customers are mainly Muslims but also at other races.

2) Economic

Economic forces make reference to the type and direction of the market where business operates. Economical factors have a tremendous impact on business companies. The impact of progress or decrease in gross nationwide product and raises or decreases in interest levels, inflation, and the value of the money are considered as prime examples of significant impact on business procedures. Malaysia happens to be experiencing economic progress and enlargement at a slow rate. Despite the fact that the current financial situation does not impact the fast-food much, Radix Fried Chicken breast experienced hook improvement in business. This can be because Radix Fried Chicken's products are cheaper compare to its competitors.

3) Political/legal

Political-legal forces include the final results of elections, legislation, and judge judgments, as well as the decisions rendered by various commissions and organizations. The politics sector of the environment presents actual and potential limitation along the way an organization performs. Radix Fried Hen (RFC) is a Muslim founded restaurant with a halal position. Therefore, RFC must abide the rules and regulations arranged by JAKIM (Jabatan Kemajuan Islam Malaysia) or the Halal Industry Development Organization.

4) Sociocultural

Social pushes include traditions, prices, societal movements, consumer mindset, and a society's objectives of business. Listed below are some of the main element concerns in the sociable environment: ecology (e. g. , global warming, pollution); demographics (e. g. , people growth rates, increasing age employees in industrialized countries, high educational requirements); quality of life (e. g. , education, protection, health care, standard of living); and noneconomic activities (e. g. , charities). Malaysia is currently experiencing a drop in the national birth rate as well as a general reduction in the size of an average family. With this change in family composition, individuals are spending more on themselves and eating out more frequently. Furthermore, younger generation in the current Malaysian contemporary society has a strong liking for fast-food. These sociocultural changes in Malaysia donate to RFC's business.

5) Technological

Technological forces affect organizations in several ways. A technological innovation can have a sudden and dramatic influence on the environment of a firm. Technological trends can significantly alter the demand for an organization or industry's products or services. Technological change can decimate existing businesses and even complete companies, since its shifts demand in one product to another. In addition, changes in technology make a difference a firm's procedures as well its products and services. Many organizations are increasing their usage in technology in their businesses. Radix Fried Fowl has chosen to use Posiflex at the cash register which allows the staff to control the money in a safer way. Besides that, Radix Fried Fowl also uses Robotcoup to make their coleslaw.

6) Global

The global dimension of the environment identifies factors in a country that have an effect on a business. Although the essential management functions of planning, managing, staffing, leading, and handling will be the same whether a company performs domestically or internationally, professionals encounter challenges and risks on an international scale. Whether it be unfamiliarity with words or customs or issues within the united states itself (think mad cow disease), professionals encounter global hazards that they probably wouldn't have encountered if they possessed stayed on their own shores. Many organizations on the globe are proceeding towards globalization. Radix Fried Rooster is third, trend and is also planning to broaden their business by starting branches of RFC in China, Indonesia, Saudi Arabia and other middle-eastern countries. In order to make their globalization efforts work, they need to ensure that their products are in tip-top condition and enhance their inventory management by ensuring their items are always reliable.

7) Physical Environment

The physical environment refers to the exterior surrounding and conditions where something exists. It can be described as the vitality consumption, tactics used to build up energy options and also lessening a firm's environmental footprint. It is also related to the developments focused to sustaining the world's physical environment and the impact of ecological, communal, and economic systems. In their attempt to be socially accountable and eco-friendly, Radix Fried Chicken uses organic poultry because of their fried chicken. Organic and natural chickens are healthy and are safe for the intake of consumers as these chickens aren't given any antibiotic growth promoters and are given with supply which is free from genetically revised feedstuffs.

3. 2 Industry Conditions ( Porter's Five Pushes Analysis)

The industry conditions also called Porter's five makes analysis is a framework for the industry evaluation and business strategy development created by Michael E. Porter. This platform points out the five makes that determine the competitive depth and attractiveness of market.

1) Hazards of new entrance

RFC is facing competition, as it is a fresh entrant in the market, it was opened up in 1998.

It threatens the marketplace show of already existing fast food companies who are its main opponents. RFC must come up with methods to differentiate their product to be able to survive in the market

2) Bargaining Power of Suppliers

RFC gets almost all of its input products, shares and equipment (natural remedies) from HPA products that are produced in the HPA factories. Turning costs could end up being high should RFC consider, due to the performance of the suppliers.

3) Bargaining Electric power of Customers

RFC has provides cheaper charged food when compared with others, which may act as an edge for them.

4) Risk of Substitute Products

RFC's direct competition is KFC as they have a tendency to sell the almost similiar food and drinks.

5) Intensity of Rivalry

KFC which is RFC's main competitor has an benefit over RFC as it is more developed, and also is a global business. RFC on the other side is new and still has a long way to go. A strategy that can work their way is their much targeted 'Halal' branding which has a huge prospect of success. For RFC to prosper, it has to concentrate on creating a solid brand so that it can be able to compete with the already existing junk food chains such as MacDonald's and KFC.

3. 3 Stakeholders

A stakeholder is a person, group or group that has immediate or indirect stake within an firm. Stakeholders are several very important people to a business because they could be afflicted or may be afflicted by an organization's actions, decisions, targets, and policies. In this case, Radix Fried Chicken's key stakeholders are their customers, employees and suppliers.

1) Customers/ consumers

RFC's main customers are mainly Muslims, especially Malaysian Muslims. However, they also provide customers who are non-Muslims who are of different religious beliefs, races and ethnic categories as Malaysia is a multi-cultural country with diverse cultures. Therefore, all the meals in their menu are based on the halal standards. Customers or individuals are one of RFC's stakeholders because RFC is in charge of their customers' health, time, money and also their marriage with them (customers).

2) Employees

All of RFC's employees are Muslims because they only use Muslim workers. Due to this, their work techniques, culture and polices derive from the Islam Syari'ah laws. RFC is responsible for their employees' basic safety and privileges.

3) Suppliers

RFC suppliers are HPA. They obtained their herbal remedies from HPA in Kedah and Chicken from Perlis. RFC reaches stake with their suppliers because they need to ensure that they pay their suppliers promptly.

3. 4 SWOT Analysis

SWOT analysis is a way of proper planning used to evaluate the talents, weaknesses, opportunities, and hazards involved in a project or in a business venture. SWOT analysis also includes specifying the objective and eyesight of the business venture. It can even be an instrument for auditing a business and its environment. SWOT research is generally used by businesses or organizations to recognize the key interior and exterior factors that are essential to achieve target in this company.

Basically, the internal factors mean that the strength and weaknesses in the inner management to the business. For instance, the businesses must identify their talents and weaknesses in resources, functions and key competencies so that they can in a position to identify whether their organization have center competencies in areas necessary to achieve a competitive advantages. On the other hand, they could decide to outsource their weak function or activity in order to boost customer's value to the firm's products. Inversely, exterior factors are the opportunities and dangers provided by the exterior environment to the business. A chance is a problem in the overall environment that if exploited effectively can help an organization achieve tactical competitiveness on the market. However, a threat is an ailment in the overall environment that could hinder organization efforts to achieve strategic competitiveness which may cause trouble for the business.

The SWOT research of RFC is summarized the following:

Strengths:

Their foods are unique and various compare to other fast-food restaurants as natural natural herbs and spices are being used as ingredients in their food. For instance, their Radix Cola and fried rooster are produced from herbs.

Good customer support. RFC has excellent customer service as the staffs are polite and will patiently pay attention to their customers' needs. They are also productive in the portion of these food as food is served to customers within a brief time frame upon buying.

Has a good reputation for the excellent quality control in their food.

Good balance of budget. RFC were able to balance their budget well in order to accomplish their low-cost strategy where they try to lessen their costs and price their food at a relatively cheap compare with their competitors.

Weaknesses:

Weak brand presence and image. Many people have no idea about the lifestyle of RFC.

Insufficient used of systems. RFC does not use much technology in their production or service.

Financial constraints. RFC does not have much money.

Does not have many stores. Besides that, the locations of RFC shops aren't situated at proper locations.

Skills of employees. The employees are not equipped with insufficient skills as most of them are SPM leavers.

Inefficient inventory management. RFC often experienced a shortage in companies and items which cause them loss sometimes.

Opportunities:

The halal or Muslim market. RFC is the best Muslim -based mostly restaurant in Malaysia and this gives them an edge over other fast-food restaurants as Malaysia is lady country.

Globalization. RFC is likely to expand their business overseas to countries such as China, Indonesia, Arab and other Middle-eastern countries.

Threats:

Stiff competition. RFC has to contend with other fast-food restaurants with a solid customer base such as McDonald's, Kentucky Fried Fowl and Pizza Hut.

3. 5 Synopsis of Situation Analysis

The Situation Research is divided into four subject areas, which will be the Standard Environment, Industry Conditions, Stakeholders and the SWOT Analysis.

There are seven standard environments for the Radix Fried Rooster; Demographic, Economic, Political/Legal, Sociocultural, Technological, Global and Physical Environment. This theme focuses on the environment that Radix Fried Chicken (RFC) is. In demographic causes, it describes the mark market of RFC which is mainly Muslims. For economic forces, RFC is functioning in an current economic climate where the progress rate is slow. As for the political or legal, RFC must abide the rules and regulations place by JAKIM. In sociocultural makes, more people are dining out and the preference for fast-food is high among young people. For the technological makes, RFC uses posiflex at the cash register so the money is better. Besides that, RFC uses a robotcoup for making coleslaw. The global causes point out that RFC is thinking about beginning a branch in Indonesia, Saudi Arabia, China and Middle Eastern countries. As for physical environment, RFC uses organic chicken in their fried rooster.

In the Industry Conditions, the Michael Porter's Five Push Analysis can be used. The first pressure in the construction is the threats of new entrant. As we all know that RFC is a new junk food restaurant. So it encounters competition from other restaurants that are competent like KFC or McDonalds. Next is the bargaining vitality of the suppliers. RFC gets almost all of its products off their father or mother company which is HPA. So transitioning cost would be really high for RFC to consider due to the success of the dealer. In bargaining electric power of customers, RFC offers cheaper prices than their opponents, which can be an benefit for customers. Next is the threat of substitute products, which really is a drawback for RFC because they sell the same products as their competitors who provide many substitute products in the market. The last power in the five forces framework is the intensity of rivalry between RFC and other junk food restaurants. RFC main competition, KFC has an advantage in it because they're globally known and being successful over their dedicated customers is a difficult task.

RFC has three key stakeholders, that happen to be; customers, employees and suppliers. RFC's customers are generally Malaysians but they more focus on Muslims because their main purpose is to provide halal food. As for the employees, all of them are Muslims. So, the culture and everything the techniques and regulations are based on Islam's Syariah Legislation. RFC's main dealer is HPA, where they obtain almost all their recycleables from.

The SWOT Analysis identifies RFC's power and weaknesses, threats and opportunities. For power, RFC is different from its rivals because their products are herbs-based. For instance is their fried chicken breast and Radix Cola. They also offer high quality products and good services at a cheaper price compare to their competitors. For the weaknesses, we have recognized that RFC doesn't have a strong brand name because many did not find out about their existence. Apart from that, RFC lacks in technology, money, and employee's skills and has a poor inventory management. As RFC is a halal fast-food restaurant, they have got an chance to break into the Muslim market and develop their business to Islamic countries like Saudi Arabia and Middle-eastern countries. Lastly, operating within an industry with strong rivals that are globally recognized like KFC, McDonalds and Pizza Hut is a threat to RFC.

4. 0 Strategic Options

Strategic options are creative different action-oriented responses to the exterior situation an organization faces. Tactical options take benefit of facts and actors, styles, opportunities and risk of the outside world. Proper options can be recognized after an institutional analysis, remember the aspirations (basic question) of a business.

The tactical options for RFC are:

Product differentiation; give a variety of choices in menu.

Although RFC is much less popular as KFC, RFC can established a focus on or try to achieve higher rates when it comes to chicken breast restaurant chains, convenience restaurants and variety food company. For example, Zigzag Wedges, Radix Great Bun, Herb Burger, Sambal Burger, Rice delight, Radix Nugget, Rosties, and Tortillas are some of their menu. Besides that, RFC likewise have their own beverage selections, such as Radix cola, Radix supplement slimming tea, and Radix natural herb coffee. RFC can develop or add some more selections to identify themselves with other opponents. For example, they will offer customer menu choices which are produced from seafood such as fried shrimp, fried squid, and squid burger, so that seafood lovers can have their dishes there.

Improve on the marketing strategies.

When the clients witness adverts of services and promotions provided by RFC, they might show interest to the new product advertised. This helps RFC to attract more their fast food buffs to buy more o their products. Yet, the online marketing strategy should be genuine and the quality of the product must meet their customer expectations.

Improve on the media usage

RFC should establish a new website or reinforce their current website by which makes it more appealing and user-friendly. The web site should be easy to get at so that visitors can view the webpage and get more info about the RFC, the food they offer, latest posts and promotions.

Maximize the good thing about being the local halal junk food company

RFC should improve the good thing about being the first HALAL hub in Malaysia as nearly all its individuals' are Muslim.

Open 24-time franchises with drive- thru

RFC need to construct many franchises that open 24-hours since it is far more convenient for their customers. RFC also have to add a drive- thru service because, if the customer is in a rush and don't have period to dine in, they may use the drive thru service which is very convenient. In so doing, RFC will eventually earn more customer devotion as it gives customers the impression of being a good company.

Key Selection Criteria

For days gone by ten years, RFC has a substantial improvement as an end result of the successful execution of lots of key initiatives such as a strategy of continuing restaurant extension and the execution of effective RFC branding and marketing program to enhance the competitive benefit and build up the marketing position of being the halal fast food company in Malaysia. There are some key selection requirements that may have an impact on the strategies for the organization.

Financial stability

The cost of applying of strategic planning is high and it may incur extra expenditures for the organization at the start of stage. The excess cost is necessary if RFC packages to increase its business in its tactical plan. If the positioning that RFC expands its business at is not ideal, then the cost of venturing in the area may not be worth the effort. Strategic planning is a type of long-term planning. Therefore, RFC should carefully plan an in depth accounting budget plan to control their cash flows.

Suitability

The overall root rule of the strategy should be match the goal of group. The strategy must offer with the main strategic issues by the RFC's strategic position. All of the strategic programs should be ideal for the consumers of Malaysia and overseas countries; international markets and even federal. Economies of scale should be analyzed in order to execute the best strategic ideas.

Feasibility

The resources that are needed in the implementation of strategy need to be available, which may be developed or achieved. Important resources such as people, time and information should be available for the implementation of strategy. In globalization, the feasibility of resources will have an effect on the strategic planning in the precise market. Therefore, the feasibility of the resources is very essential in proper planning.

Acceptability

The performance of results such as go back and risk must meet the expectation of the stakeholders including mainly shareholders, employees and customers.

The products must be accepted by the stakeholders such as customers. If the products could not appeal to the customers, RFC might incur deficits. If the lifestyle of consumers inclines towards a health-conscious lifestyle, RFC will have to produce products which have high vitamins and minerals. However, high dietary foods may not taste good, which might lower the customers' demand for their products.

Timeliness

RFC will need more time to broaden its business internationally. The strategic planning to develop the business oversea is time consuming. RFC needs to spend additional time on their proper planning to prevent the plan from faltering.

6. 0 Recommendations

1) Increase utilization of technology

Radix Fred Hen should outfitted their outlet stores with better and more complex technology. For instance, they could invest in a Continuous Fryer which is utilized in popular fast-food restaurant such as KFC and McDonald's to fry hamburger patties, poultry nuggets, and steaks. By equipping their shops with an increase of advanced technology, RFC can compete and become on par with other popular fast-food restaurants. Besides that, these systems will help RFC to increase in output and efficiency, which will later result in more earnings. However, the implementation of these systems will be costly because they are expensive. They will also be dangerous and may cause losses or wastage if employees misuse or don't have sufficient skills to operate them.

2) Create brand recognition through promotional methods

Radix Fried Fowl should create brand consciousness by using promotional strategies such as advertising, personal offering and internet marketing. Advertising can be done via tv, radio and billboards, and also published ads like publications and newspaper publishers. RFC can also send out flyers and pamphlets which is another cheaper alternative of advertising. Advertising can reach a broad audience and through it, more people will know about RFC living. RFC can use personal selling giving out free examples of RFC's food for the general public to taste. This technique will not only cause consumers to be interested but makes them potential prospects if they have a preference towards the food they have tasted. Furthermore to free examples, RFC can consider giving out vouchers and coupons as this will encourage people to acquire foods from RFC. Creating brand consciousness via promotional methods may increase RFC bills and increase their financial burden. However, it will enjoy benefits for RFC over time once RFC has form a strong customer bottom part.

3) Employee development

RFC should develop their workers so that their workers will be more skillful and competent. They can accomplish that by organizing staff development programs like training seminars and training camps where you will see mentors to guide the employees. They can also enroll their workers for enrichment lessons such words classes, computer skills classes and service related programs. Employee development will not only gain the employees but also gain RFC for skillful and capable employees will increase production in the workplace, which will later bring about more profits attained. However, this technique may throw away cash and time, and not succeed if the employees are not interested in bettering and growing themselves.

4) Improve inventory management

RFC should constantly keep track of their stock and materials in order to take immediate action and replenish their inventory when their resources are nearing a lack. RFC also needs to keep an eye on the orders they have on average in a day in order to estimate the quantity of raw materials they have to purchase. They could accomplish that by investing in Restaurant Point of Sales software that runs on personal computers, and helps in assisting businesses to trail transactions instantly. Besides that, they also needs to constantly communicate and also have a good marriage using their suppliers so that their supplies will arrive promptly. By enhancing their inventory management system, RFC won't experience shortages in their stock, resulting in better customer service and increased gains. The only restriction of the is that there is no room for problems. Employees must be extremely careful when saving stocks and shares in the inventory for any fault in the files cause RFC loss.

5) Partnerships or alliances

RFC should think about creating partnerships with well-established fast-food companies or other food and drink companies. By establishing such relationships, RFC will be able to reduce their financial burden and could have a much better opportunity to heighten their brand image or occurrence and also expand their business by making use of the companies they partner with. Besides that, RFC will be able to grab more skills and knowledge related to the industry as their will be a writing of information and knowledge among companies. However, this might also be a setback to RFC as their partner companies may know RFC secrets and imitate their specialties.

7. 0 Conclusion

Radix Fried Hen (RFC) is a Muslim structured fast-food restaurant under HPA. It focuses on providing safe and halal foods for Muslims and non-Muslims as well. Predicated on our investigations, we found that RFC is experiencing troubles contending in the fast-food market. They lack of brand existence and are much behind in conditions of technology and development compare to renowned fast-food companies such as KFC, McDonald's, and Pizza Hut. This can be because of the fact that RFC has financial constraints and budget balancing problems, which explains why they didn't use advanced technology nor use any promotional tools to set-up brand awareness for their company. However, RFC still has potential in the fast-food industry as they are the sole Islam- based junk food restaurant, in Malaysia, and want into breaking into Muslim market segments in Muslim countries.

In finish, RFC can overcome their obstacles in rivalling in the fast-food industry after they know their weaknesses and hazards; and take the appropriate actions to deal with them, and create a strong brand name and customer platform for themselves.

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