Darden Restaurants Case Study

1158 Words Jan 10th, 2018 5 Pages
The Darden empire encompasses Red Lobster, Olive Garden, LongHorn Steakhouse, and The Capital Grille, amongst many other restaurants. According to its official website: "through subsidiaries, we own and operate more than 2,000 restaurants, employ 185,000 people and serve more than 400 million meals a year" (Darden Restaurants, 2012). Identification of the industry and competitors
Sit-down chains such as Darden's and competitors such as Applebee's and Friday's offer comfortable, predictable dining options to middle-income consumers who want reasonably-priced restaurants to which they can take their families but which offer more ambiance than a fast food restaurant. Potential profitability of the industry
The restaurant industry has a tighter profit margin than almost any other industry. Profits are razor-thin; ingredients are perishable; and restaurants are extremely reliant upon suppliers to remain stable and to make a profit. Even when a restaurant is popular, high operating costs can cause it to remain in the red. Although Darden Restaurants can take advantage of economies of scale, it is still vulnerable to the whims of a fickle public. Dining out at a restaurant, even a slightly expensive restaurant is a luxury rather than a necessity, and small hiccups in the business cycle can have a…
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