Launching a fast-food restaurant requires a lot of resources in the beginning. When you approach the bank or any financial institution, then they would ask to conduct a swot analysis of your fast-food restaurant and provide them the report.
The swot analysis of a fast-food restaurant business is the best way to present the current state of your business, how it would perform in the market, and how it would compete in the market against competitors. You have to keep in mind the good and bad points of your restaurant business that would be strengths or weaknesses relevant to competitors.
You can use your strengths to exploit opportunities in the market, or you can promote the business to have a competitive edge. The process is the same whether you’re operating a business in the US or the UK.
Today, we’ll study the swot analysis of a fast-food restaurant business; it would analyze the strengths, weaknesses, opportunities, and threats of the restaurant business.
Here’s the swot analysis of the fast-food restaurant business as follows;
Fast Food Restaurant Business Strengths
Experienced hotels and restaurants know the significance of skilled and trained employees. Those who don’t pay attention to the professional development of their staff; end up very badly for them. However, the experienced and trained staff don’t mess things up, and they save your resources. On the other hand, inexperienced and ill-trained employees experiment with different cooking techniques at your cost by wasting a plethora of resources.
Good Options in the Menu
You should offer a variety of unique items in your fast-food menu like frosty, blizzard dairy queen, curly fries, chicken sandwiches, chicken popeyes, waffles fries, burgers, and many others. When you have a diverse food menu, then it gives you a unique competitive edge over competitors. The customer should be confident that they would get everything whatever they’re looking for at your outlet.
Brand Image of Restaurant
One of the most important things for fast-food restaurant businesses is its brand image. If you have established a brand image with consistent marketing and promotional campaigns, then customers would follow wherever you go. It’s because trying out a new food outlet is risky in terms of taste and quality, that’s why customers prefer to try out something that they already know and are familiar with.
Offer Unique Fast-Food Items
Along with offering a variety of fast food items, your restaurant menu should comprise unique items. It would be difficult for you to attract and retain customers if you’re offering the same products that competitors are offering. The unique fast-food items on the menu would help you to gain a competitive advantage.
New Service Style
The unique food items, diverse menu, and brand image don’t have any value if your service style is poor and outdated. It shows the significance of service style. Therefore, it should be new, unique, charming, and attractive, so that the customer would like to enjoy the experience of your fast-food restaurant and invite their friends over there.
Price matters in the fast-food restaurant business, because customers have to buy it over and over again every day. If you’re offering quality and tasty fast food items at a low price than competitors, then it’s a huge competitive edge. Your restaurant business could remain by increase the volume of sales at a low price.
The Exterior of Your Outlet
Cleanliness and tidiness are the basic foundation of every successful fast-food restaurant brand. People don’t like to visit any such food outlet which is dirty and garbage piled up around it. Therefore, you should pay extra attention to the cleanliness of the restaurant both interior and exterior. It would show your commitment to quality food.
Fast Food Restaurant Business Weaknesses
Far Away Location
You have got a perfect fast-food outlet, excellent food menu, and great variety, but it’s situated far away from the population. Then people would rarely visit your restaurant and buy food items from you. It would take a lot of time for your establishment to be profitable. The distant location is such a weak factor that you can’t fix it easily.
No Drive Through
Whether your fast-food restaurant is on the highway or in the city, then it’s very important for your business to have a drive-through option. More and more fast-food chain restaurants are investing their resources in the drive-thru option. However, if your food outlet doesn’t offer a drive-thru shopping option, then you would lose a lot of customers.
Same Menue as Competitors’
If your fast-food restaurant is offering the same food items as the competitors, then it would be very difficult for you to stay in the competitive environment. You have to differentiate yourself in order to make your name in the market. Differentiation is the key; it could be in the form of taste, menu, interior, exterior, or anything else.
When we talk about updating the food menu, launching new items, upgrading interior and exterior, improving service quality, or employee training and development; all of these projects require funding. If your restaurant doesn’t have sufficient financial resources, then you won’t be able to take advantage of many opportunities.
New Fast-Food Outlet
If your fast-food brand is new in the market, then it requires a lot of time, marketing and promotional campaigns, and patience to earn the trust of customers. You can’t expect customers to change their brand loyalty easily, you have to be consistent and prove your commitment to your work.
Fast Food Restaurant Business Opportunities
New Building for Expansion
You have to keep your eyes and ears open if the bigger building in the neighborhood is about to get vacant. Then you should move quickly and talk to the landlord to become the next tenant in order to expand your business in terms more spacious. There’s a very narrow gap for such opportunities, therefore, you should take advantage of it as soon as you can.
Competitors Closing Down
If any of the competitive brands are closing down their business in the area, then you should increase your marketing and promotional campaigns to attract its customers. Those customers have to buy fast food, your focus is that they should buy it from you. If it requires a little upgrade, then do it for new customers.
New Housing Development
If there’s a housing development and establishment of the new residential, then install billboards of your brand and distribute posters for the sake of marketing. It’s a good way to let people know about your presence in the market.
Opening of a New Branch
If there’s an opening of a new office building in the area, then you should go there and introduce your fast-food business and the type of food you’re offering. You can offer a special discount to the employees of the office.
Fast Food Restaurant Business Threats
Low Prices of Competitors
If competitors are offering products at a lower price than you, then it’s not good news. If you lower the price to retain customers, then you have to bear all the discounting costs. However, if you don’t lower the price, then you would lose the sale. It’s a lose-lose situation either way.
In the post-pandemic world, various costs like rental, operational, supplies, employees’ salaries, and others have increased a lot. When basic costs rise up, you don’t have any other choice but to increase the retail price and it’s something that customers don’t take it lightly.
New Street Brand in the Market
If a new street brand enters the fast-food market in your area, then it would attract the attention of many customers. If it stays in the market, then it would cut down your sales and profit in half. You have to come up with a new strategy to deal with the whole situation, and it requires urgency.