14 Aug What, if any, product or product line modifications will Outback have to make in

What, if any, product or product line modifications will Outback have to make in the country you chose in order to be successful? Are any changes necessary in the design of the restaurants? Explain why changes will or will not be made.Week 3 Group C Part 1Erica Simonson, Ashlynn Couturier and Chardae SledgeWalden UniversityJanuary 25th, 2015Identification and analysis of the element of sustainable advantage in a successful domesticstrategy. (A SWOT analysis may be helpful here).Outback Steakhouse was started by Chris Sullivan, Bob Basham and Tim Gannon in 1987.They saw market demand for steakhouses. The three created Outback Steakhouse, an Australianthemed steakhouse, thats positioning was to provide excellent food in a comfortable, cheerfuland fun experience (International­Outback Steakhouse, n.d.).Strengths­ Outback Steakhouse is so successful due to its many strengths. Outback provides aquality product at an affordable price. According to the owners, Outback’s tactic was to takeclassic American meat and potatoes and add flavor to it so that appeals to the aging population(International­Outback Steakhouse (n.d). Outback is successful because it partners withsuppliers to ensure that it is receiving and selling the best products available. Outback is alsovery gracious towards its employees making it a stronger company as a whole.Weaknesses­ The weaknesses of Outback are that it has a large amount of competition includingChili’s, Olive Garden, Applebee’s and Red Lobster (Restaurant News, 2014). Another weaknessis that there is a ceiling of how many Outback Steakhouses that the United States can handle,while continuing to be successful. Too many restaurants will create over saturation and lead tofailure. Outback will need to expand internationally, which poses multiple threats to the brandincluding competition, the menu and concept not appealing to other areas and supply chainissues.Opportunities­ The biggest opportunity for Outback Steakhouse is to expand internationally.Other U.S. based international restaurants have shown growth in the past years and this couldalso be the case for Outback Steakhouse (International­Outback Steakhouse (n.d.). In addition tothis, Outback could also expand in its current market by creating other offerings, such as a fastfood restaurant or expanding their catering operations.Threats­The biggest threat that faces Outback steakhouse is the economy. If the economy falls,people have less money to go out to eat an enjoy luxuries. Another threat is competition.According to the Outback Management, the United States can only accommodate 550 to 600 oftheir restaurants before the market is saturated. With increased competition this number willbecome even smaller.Evaluation of the transferability of successful domestic strategy into international markets.Provide rationale for your point of view. (Consider barriers to entry and competition).Organizations tend to operate in different countries in four different ways, which consistthrough trade, strategic alliances, investment and franchising. Outback Steakhouse has manycompetitors in the market and international operations will force major competition to step theirgame up in the international markets. Depending on the entry and exit barriers of the countrythey choose to go in and consumer choices Outback Steakhouse may seek entry through differentlevels of international investments Outback Steakhouse may choose to make foreign direct investments, which allow them tocontrol their assets in other countries. Another way Outback Steakhouse can form alliances indifferent countries in the global market with other restaurants. Although strategic alliances comeinmany forms, there are some that enables each restaurant access to market their products as anaffiliated with the home country. A well known restaurant in that country can help theinternational company deal with and conquer these difficult barriers because it is accustomed tothem.Outback Steakhouse may partake in the international market by either licensing or franchise.When dealing with licensing it involves the right to use brand names, trademarks, copyrights, orpatents in return for royalty payments from that organization. On the other hand franchising iswhen a company allows another company to use their name and ways of operations for royaltypayments also.Global methodology concentrates on utilization of organization assets so an organization cancontend effectively in the picked markets. Case in point, an organization may choose todesignate its assets focused around product offerings or geological areas.Management must decide where the company can achieve competitive advantage over otherrestaurants in the industry. Management can identify their competitive advantage by determiningwhat the company does better than its competitors. Outback Steakhouse may realize thisadvantage through a host of techniques such as using superior technology, implementing moreefficient organizational practices and distribution systems, and cultivating well­known brands.This component of the strategy involves not only identifying existing or potential areas ofcompetitive advantage but also developing a plan for sustaining areas of competitive advantage.Finally, global strategy should involve establishing a plan for the company that enables itsvarious functions and operations to benefit one another. For example, a company can use oneline of products to encourage sales of another line of products and thereby enabling differentparts of a business to benefit from each other.Assessment of market attractiveness in the international arena. Which markets should thecompany enter? In what order? What, if any, strategic modifications will be required? Whatchallenges need to be addressed?In the restaurant industry, Outback has been able to establish itself as a powerhouse due to theattractiveness of its business strategy, closely working with distributors and establishing workingrelationships that will assist in expanding into new markets in the future. Outback views itsdistributors as “partners” that share in Outback’s overall success and utilizes these establishedrelationships for future growth and expansion (International, n.d.). By implementing thisstrategy, underdeveloped countries are more likely to be accepting of Outback entering into themarket due to the appeal of the small local distributors being able to grow.Based on research, it would be most beneficial for Outback to enter into Russia, as well asSouth America. Both moves would provide Outback the opportunity to expand once establishedin once location due to the close proximity of other countries offering further opportunities fromexpansion. Both countries also offer underdeveloped regions where Outback can exercise itsstrategy of empowering underdeveloped locations. In regards to specifically South America,significant amount of tourism would increase the appeal for Outback to enter into the market.Outback should enter into South America first, due to its large tourism market. American stylefood market has already been established, and therefore many of the major challenges ofintroducing a new concept have already been faced.There will be several challenges faced by Outback while entering both South America andRussia. The first of these challenges, language barriers, applies to both regions. Attempting totranslate an Australian themed restaurant, with Australian/American wording into something thatwould be understood in both Spanish and Russian may prove difficult. Second, the Americanthemed food may not appeal to natives in South America. Lastly, given the tension betweenRussia and America, the American based restaurant may not be warmly welcomed by theRussian people.ResourcesInternational ­ Outback Steakhouse. (n.d.). Retrieved January 24, 2015, fromhttp://www.outback.com/our­company/internationalRestaurant News (2014). Top 100 Chains­US. Retrieved from http://nrn.com/us­top­100/top­100­chains­us­sales.

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