4357
REV: FEBRUARY 26, 2013
CHRISTOPHER A. BARTLETT
ARAR HAN
Levendary Café:
The China Challenge
Levendary Café was spun out from private equity ownership in January 2011, and the following month, Mia Foster was named as its new CEO. The departing CEO, Howard Leventhal, was the beloved founder of the popular chain of 3,500 cafés. He had grown a small Denver soup, salad, and sandwich restaurant into a $10 billion business, but after 32 years was moving on to new interests.
This was Foster’s first job as CEO. Previously, the 47-year-old had been president of the U.S. business of a large American fast food company for seven years. She had started her career at a major global accounting firm, leaving to earn an MBA from
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4357 | Levendary Café: The China Challenge
The Multi-Unit Restaurant Business
In 2010, the U.S. restaurant and contract foodservice industry was a $600 billion industry with
960,000 locations.1 Multi-unit restaurant concepts represented approximately 30% of the industry by units, with independent operators as the balance. The restaurant and foodservice industry was highly fragmented, and even industry giant McDonald’s generated just 2% of total revenues.
Multi-unit concepts were generally categorized into three industry segments:
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Specialty Establishments like Starbucks, Dunkin’ Donuts, and Baskin-Robbins primarily served snacks and beverages under $5.
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Quick Service Restaurants, or so-called “fast food” concepts like McDonald’s, Taco Bell, and
Wendy’s, provided counter or drive-through service with average tickets between $4 and $10.
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Casual Dining included brands like Olive Garden, Applebee’s, and Outback, and offered table service for dinner entrees priced between $8 and $20. Within this group, fine dining concepts like Ruth’s Chris and Capital Grille featured entrées into the $40 range.
While some concepts had bridged these categories for years (e.g., Friendly’s offered casual dining coupled with a strong takeaway ice cream business), more recently several concepts had clustered around an emerging category often called "Quick Casual." For example, Panda Express
These figures are not definite and will likely change over time as figures are being actualized every year. These assumptions were based on an article written by the National Restaurant Association where they stated that as long as the economy keeps doing well the estimated sales in restaurants will exceed $604 Billion in 2011 alone (National Restaurant Association, 2011). From the projected forecast of sales for 2011 we are assuming that the prosperity in growth will continue each year. However with any economy nothing is for sure and sales should be monitored and increasing prices to keep up with costs will most likely need to be reviewed bi-annually.
In addition, they installed a database management system for store managers and corporate executives to monitor day-to-day operations, launched a catering department, and expanded internationally by adding franchises to their organizational structure (Thompson C-169). Shaich used franchises to stimulate growth by requiring qualified outside investors to open and manage at least 15 franchised cafes in a six-year period under the company name (Franchise Information).
The case presented involves the Polaris Cafe’ located in New Brunswick, New Jersey. The Polaris Café was founded by four partners: Ben Reynolds, responsible for marketing and public relations; Kyle Roman, the overall manager; Sid Carter, responsible for the financial management, potential investors, and obtaining bank loans; and Dominick Trioli, responsible for payroll and purchasing. New Brunswick is a college town, home to Rutgers University and several large corporations, such as Johnson & Johnson.
In order for our business, The Broadway Café, to become more competitive in this environment, I deem it necessary to build a collaboration tool that will stimulate contact, knowledge, information, and events among employees, customers, suppliers, and all others who are interested in the business.
After searching and various discussions, the Boards of The Care Group and BID made the decision to appoint Paul Levy. They also secured an agreement from the AG to foreclose the idea of selling the BID to a for-profit hospital. Levy’s first day as CEO of BID was January 7, 2002.
Helena Maria Viramontes grew up in Los Angeles where relatives used to stay and live with her family when making the transition from Mexico to the United States. This is where she got her first taste of the lives of immigrants in this country within the urban barrios. Viramontes's writing reflects this theme along with expressing her political opinions on the treatments of immigrants, especially Chicanos and Latinos. In her short story "The Cariboo Café," Viramontes brings these ideas to life through three sections narrated by different individuals tied into the story.
1. Statement of Problem: What are the problems being faced and the most important 3-4 decisions the company needs to make regarding the situation of the company in China.
Threat: Louis Chen, the VP in charge of Chinese business, is ruining the brand of Levendary Café. Customers come from all over the world. When they visit the store in China, they can tell that there is something wrong with the decoration and menu in the Chinese store. It will destroy the company’s reputation if they notice that the menu is totally different from what it is in the United States. There are Pizza Hut, Starbucks and other competitive American brands, which are growing steadily and widely. They will split the market share from Levendary Café.
If we look at the fast food industry today there is room for success. Based on RNCOS’ new US Fast Food Market Outlook 2010, fast food industry growth rate is strong. Especially, hamburger sales growth is reported at the healthy rate of 4.6% in 2008. The market is expected to grow to cross the $170 billion marks by 2010.It is believed that due to the economic meltdown, fast food industry is benefiting from people being more prices conscious. People who were enjoying nice means at fancier restaurants are now turning their choice of means to more economical ways.
In late April of 1991, Lydia and Lou decided to take the planning process to the next level and decided to start executing some of their plans. This is when some of the setbacks started to take place. When starting this new business venture, technology wasn’t popular yet and they needed to market their new restaurant to the clients that they wanted to appeal to. They weren’t to see how to go about doing this. Their menu would be moderately priced and there were many surrounding businesses close by. They thought
In scope, all three of Mia Foster’s issues are interconnected. To tackle each individually will suffice the next issue starting with Louis Chen and the China operations. If she were to review Levendary Café’s foundation, along with the Board and COO – Lucian Leclerc, they will be reminded that they are known for their willingness for taking risks – especially those that helped evolve its concept over time. What may have worked in Levendary Café #1 in the US 32 years ago may not work in
from a small local store to its current global enterprise. Starbucks has strategic partners all over
The restaurant industry is said to be one of the oldest industries in the economy. As the economy and urbanization grow, so too does the industry of restaurants; it’s for this reason that the industry has been growing at a rapid pace. Even with the restaurant industry ebbing and flowing, there are still new entities entering the fray consistently. Some restaurants may close, but it will not be too long before a new restaurant opens in the place of the old one. Historically, the restaurant industry has contributed nearly 4 percent to the gross domestic product (GDP) of the United States (U.S.) economy. The most recent findings show that the restaurant industry employs more than 12.7 million people (which is approximately equal to 9 percent of the
Levendary Café has grown from a small restaurant that offers soup, salad, and sandwiches in Denver to a multibillion quick casual chain that operates 3500 stores around the U.S. The founder of the Levendary Café, Howard Leventhal managed to establish a strong market position for the Levendary Café in the U.S and succeeded in creating a $10 billion
After Lam finished up her three years in accounting, she ended up working at a courier company for another three years. After three years, she walked out on the job because she wanted