SWOT ANALYSIS

The SWOT analysis is a strategic planning tool that helps in identifying strengths,

weaknesses, opportunities, and threats to a busines. Determining these areas will help

in optimizing strengths, deducing weaknesses, learn opportunities, and eradicate

threats. The purpose of the SWOT analysis is to have a knowledge of the factors that

can have substantial affect to your company for a period.

The results of the analysis will help the business owners to better understand their

environment, focus into areas that the owners need to improve and/or maintain. This

tool will guide them for a chance of survival of the business.

Strengths Weakness

 a lucrative location of the business  being relatively new in the market,

 having distinct style compared to the brand is quietly unknown

 competitors  market is congested

 differentiated products and services  lesser experience by the owners

 weak initial cash flow

Opportunities Threats

 aggressive marketing through different  economic recession

channels  health concerns

 the industry caters a large market  highly dependent to suppliers

 competitors might duplicate internally

generated business strategies

Figure 1. SWOT Analysis

Strengths

The chosen location where the business will open its establishment is within the

metro where it will be handily accessible to the customers. The business owners are

confident that such business will be readily identifiable because of the distinct ambiance

that their place offers and the aesthetics that the owners decided to put up that are

mostly different from most of the competitors. On top of that, the business does not just
serve coffee or other beverages but also with other services that will make the

experience wholesome.

Weakness

Being new in the industry, the business owners will be having a hard time

introducing their selves and making their brand known in a tight market. The owners

foresee that having less to no experience in this industry is a major drawback to their

business since such endeavor requires extensive knowledge and experience in order to

succeed. The business owners are also expecting to struggle financially for a few

months because of weak initial cash inflows and high start-up costs.

Opportunities

Good thing with the advent of social media, it opened up many possibilities on

how to cater the business' brand to the market, with its wide range, it is probable that

the business owners can reach their targeted groups and demographics. The industry is

hustling, this explains the extensive amount of shops everywhere. Considering how big

the scope of this industry is, this is the primary reason why the owners decided to

venture in this undertaking.

Threats

The threat of economic recession is not distinct to the industry but its fatal blow

that can cause closure of the business makes up for the reason why should it be

included and highlighted. The problem of health concerns, such as obesity, diabetes,

etc. poses a significant threat that might discourage the buying market. The owners’

business is highly dependent to suppliers, the business does not generate its own

supplies, thus the business owners need to procure them from the market. There is

danger here because suppliers might abuse that power, they have power over the

owners by increasing the prices and the like which are not good for a starting business.

A threat of a copycat business is also likely that can sway customers away from the

business.

COMPETITOR ANALYSIS

Starbucks is world’s largest coffeehouse chain with hundreds of establishments

located in the Philippines, Starbucks is the most dominant player in the industry. Aside

from Starbucks, coffeehouse chains like Bo’s Coffee, and Coffee Bean and Tea Leaf

also proved to be a worthy competitor. Amidst the dominance of these huge companies,

small businesses that offer same products take a share in the market. Complements

can also be a possible competitor, providing substitutes to the products that the

business serve, keeping an eye to them would be wise.

SWOT ANALYSIS OF COMPETITORS

Strengths Weakness

 business is already established, brand  intensity of competition

is already known to a particular extent  lack of contingency plan

 loyal customers and patrons

Opportunities Threats

 opportunity to negotiate with the  economic recession

suppliers  threat of new entries

 expansion  fluctuation in market share

 increasing prices

Table 2. SWOT Analysis of Competitors

Strengths

Competitors in this industry are mostly established band, thus having loyal

customers is a huge advantage. This power gives these enterprises an edge over their

suppliers and buyers.

Weakness

The attractiveness in the industry has brought intense competition. Thus, existing

companies are in pressure to maintain their holdings in the market. The need for

constant innovation is high. A downside of having strong presence in the industry is that

entrepreneurs sometimes think the business is invincible, where a contingency plan is

often not given an attention.

Opportunities

Being in the industry for long give you the advantage of negotiating for better

terms with your supplier. This is a key factor if one want to expand the business.

Threats

The combination of increasing prices, fluctuation of share in the market, and

threat of new entries is detrimental to the organization as a whole. Safety nets should

be observed to mitigate or completely eliminate these risks.

PRICING

Business usually adjust their prices to go with the flow of changing

circumstances, such as the demand and the customer’s particularity towards prices. In

making a price strategy, managers will install a price positioning of their products and
services. Pricing is one of the major components of every business marketing plan that

will calculate the cost of production.

OBJECTIVE STRATEGY TACTICS

For continuing operation Cost-plus pricing Purchase raw materials at

the lowest cost possible

and add a mark-up.

To gain loyal customers Offering of discounts and Offering discounts for

freebies certain volume and

purchases: freebies for the

3rd visit.
To compete with Competitor-based pricing Offer a lesser price for

competitors similar products and

services those of the

competitors.

Table 3. Pricing Strategy

Customer Service Strategy

Good customer service is very important for the business in order to satisfy them

and gain their approval, or better their loyalty. Understanding the business owners'

products and services will take the business to improve more.

In achieving the set goals and objectives of Café Classique, developing an

internal growth strategy to know the relationship between the product and its market in
which it is essential to be prepared in making a strategic plan for product brand to be

recognizable. Thus, the owners' focus is on product and service development since they

are a new business.

Product and service development is a strategy where a new product or service is

introduced to the market. The business owners can start by giving discounts or freebies

for the first 50 customers or give free samples or trials. They will then be asking if the

performance is satisfactorily or not, basing on their feedbacks, the owners will either

tailor or not their products and services.

CUSTOMER SERVICE QUALITIES

 Customer-oriented

The business owners’ customer service is designed primarily to cater to the needs of

their customers. This is the core of the owners’ customer service, where they can

address their wants with immediate attention.

 Accessible
 The business owners make sure that the customer service can be easily accessed

by their clients. The business has a social media accounts where the customers can

inquire and give their feedbacks.

 Effective

It is the business owners’ utmost responsibility that the needs of their customers are

delivered in a satisfactorily manner.

 Efficient

Time is a valuable resource, and once wasted it is gone forever. Thus, in this

business, time management is implemented to deliver services with efficiency.