Papa John's Case Study

996 Words Oct 1st, 2013 4 Pages
Business Level Strategy:
Papa John’s use of differentiation as a business level strategy is a major component of their continued success. Creating pizza with higher quality ingredients was rare in the industry when Papa John’s introduced this concept. Papa John’s not only differentiates through superior quality but also through a significant emphasis on legendary customer service. Papa John’s uses these elements of differentiation to create superior brand loyalty.
Corporate Level Strategy:
Corporate level strategies of Papa John’s consist of diversification by investing in businesses outside the scope of the pizza industry, strategic alliances with other companies, as well as a global strategy. Diversification is evidenced through
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The threat of substitutes is high as the pizza market is saturated with many different restaurants that provide options for consumers. Buyers possess significant bargaining power with the ability to purchase pizza from a multitude of restaurants. The threat of buyers is high options for buyers range from upscale (California Pizza Kitchen) to bargains (Cici’s Pizza).
Recommendation & Conclusions:
Papa John’s should continue with the current global strategy while finding the proper avenues to increase global expansion. The sales growth of international locations is strong and needs to continue to be exploited. Developing the proper restaurant layout and menu for each international local chosen is imperative to making this venture successful. The quality associated with the brand resonates with clients worldwide and provides room for increased growth. The domestic market should still be grown. Divesting from company owned stores through sales to franchisees will help to eliminate volatility due to economic downturns and other factors. Eliminating risk and costs associated with company owned stores will improve profitability by diversifying the revenue stream.
Appendix A:
The following table summarizes sales for the twelve-months ended December 30, 2007 and December 31, 2006, on an actual U.S. dollar basis (dollars in thousands):

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