Pret A Manger: Strategic Decision Making

ABSTRACT
A strategic report outlining Pret A Manger’s strategic

position using analysis from SWOT, PESTEL and
Porter’s 5 forces factors being plotted onto an
Environmental Matrix. This then became the base
for the two suggested strategies shown in this
report.
Barry Stuck - 21315816
Strategic Decision Making.
PRET A MANGER
Pret A Manger | Barry Stuck - 21315816
Contents:
Introduction ------------------------------------------------------------------------------------------------------------ Pg. 2
Business Operations -------------------------------------------------------------------------------------------------- Pg. 3

The Business Canvas Model ----------------------------------------------------------------------- Pg. 3
Value Chain Model ---------------------------------------------------------------------------------- Pg. 4
Strategic Capabilities ------------------------------------------------------------------------------------------------- Pg. 5

Competitive Advantage Applied in the VRIN Framework ---------------------------------- Pg. 5
Macro Analysis ------------------------------------------------------------------------------- -------------------------- Pg. 6

Pret A Manger PESTEL Analysis ------------------------------------------------------------------- Pg. 6
Political Factors --------------------------------------------------------------------------------------- Pg. 6
Economic Factors ------------------------------------------------------------------------------------- Pg. 7
Social Factors ------------------------------------------------------------------------------------------ Pg. 7
Technological Factors -------------------------------------------------------------------------------- Pg. 8
Legal Factors ------------------------------------------------------------------------------------------- Pg. 9
Environmental Factors ------------------------------------------------------------------------------ Pg. 9
Competitive Analysis ----------------------------------------------------------------------------------------------- Pg. 11

Porter’s 5 Forces ------------------------------------------------------------------------------------ Pg. 11
Threat of New Entrants --------------------------------------------------------------------------- Pg. 12
Bargaining Power of Buyers ---------------------------------------------------------------------- Pg. 12
Threat of Substitute Products ------------------------------------------------------------------- Pg. 13
Bargaining Power of Suppliers ------------------------------------------------------------------- Pg. 13
Competitive Rivalry -------------------------------------------------------------------------------- Pg. 14
Environmental Matrix ----------------------------------------------------------------------------- Pg. 15
Interpretation and Analysis of Environmental Matrix ------------------------------------- Pg. 16
Pret A Manger SWOT Analysis ------------------------------------------------------------------ Pg. 17
Internal SWOT -------------------------------------------------------------------------------------- Pg. 17
External SWOT -------------------------------------------------------------------------------------- Pg. 17
Critical Analysis of SWOT Analysis ------------------------------------------------------------- Pg. 19
Strategic Planning --------------------------------------------------------------------------------------------------- Pg. 20

Porter’s Generic Competitive Strategies Model Applied --------------------------------- Pg. 20
Bowman’s Strategy Clock Applied -------------------------------------------------------------- Pg. 21
Business Canvas Model -------------------------------------------------------------------------------------------- Pg. 22

Pret A Manger Strategy One -------------------------------------------------------------------- Pg. 22
Pret A Manger Updated Statements for Strategy One ----------------------------------- Pg. 23
Pret A Manger Strategy Two -------------------------------------------------------------------- Pg. 25
Pret A Manger Updated Statements for Strategy Two ----------------------------------- Pg. 26
Critical Discussion of Strategy One & Two With Relation to Pret’s Current SWOT and Strategic
Capabilities ------------------------------------------------------------------------------------------------------------ Pg. 27
Strategy One ---------------------------------------------------------------------------------------- Pg. 27
Strategy Two ---------------------------------------------------------------------------------------- Pg. 28
SAFe Analysis --------------------------------------------------------------------------------------------------------- Pg. 28

Strategy One ---------------------------------------------------------------------------------------- Pg. 28
Strategy Two ---------------------------------------------------------------------------------------- Pg. 29
BUCKINGHAMSHIRE NEW UNIVERSITY 1

Critical Comparison of Strategy One & Two using SAFe ---------------------------------- Pg. 30
Strategy Pret Should Choose and the Reason Why --------------------------------------------------------- Pg. 31
References ------------------------------------------------------------------------------------------------------------- Pg. 33
Appendices ------------------------------------------------------------------------------------------------------------ Pg. 37

Appendix 1 ------------------------------------------------------------------------------------------ Pg. 37
Appendix 2 ------------------------------------------------------------------------------------------ Pg. 37
Appendix 3 ------------------------------------------------------------------------------------------ Pg. 38
Appendix 4 ------------------------------------------------------------------------------------------ Pg. 38
Appendix 5 ------------------------------------------------------------------------------------------ Pg. 39
Appendix 6 ------------------------------------------------------------------------------------------ Pg. 39
Appendix 7 ------------------------------------------------------------------------------------------ Pg. 40
Appendix 8 ------------------------------------------------------------------------------------------ Pg. 40
Appendix 9 ------------------------------------------------------------------------------------------ Pg. 41

Introduction:
In 2013, the estimated value of the Sandwich and Lunchtime Foods market was £4,498m (Childe, H,
2013) and Pret A Manger is estimated
to have a 16% market share (Hsu, J,
2013), the breakdown of which can be
found in Appendix 1. For the growth in
the market, trends of consumers who
choose to spend their extra money on
dining out has declined from November
2009 – March 2015 (Ford, R, 2015 A)
which can also be seen in Appendix 2.
The value of the market itself is
estimated by Mintel to grow from
£4,498m in 2013 - £5,089m in 2018
(Childe, H, 2013), seen in Appendix 3. As for the growth of Pret, as well as product growth, according
to chief executive Clive Schlee, they are looking outside of London as they have seen the potential
away from the centre of the city (Childe, H, 2015). Pret have also started a trial of evening dining
(until 11pm) and at one store (Strand) they trailed the serving of alcohol (Ford, R, 2015), this was
from April 2015. More on Pret A Manger’s product growth can be seen in Appendix 4. As for profits,
it reported the sandwich chain made underlying profits of £76m after revenues reached £594m
(Butler, S, 2015). This report will also highlight Pret A Manger’s competitors such as Eat, Greggs and
Subway.

Business Operations:
The business canvas model:

Value Chain Model:

Strategic Capabilities:
Tangible/Resources: Intangible/Competences:
Threshold  Customers in Pret’s market  For the Eating Out market, Pret
Capabilities: expect a good selection of food needs to create distinct points of
and a selection that is delicious difference from the cheaper
whilst being well-presented retail or in-home options that are
(Morley, M, 2015). available to the consumers
 Customers also want/expect a (Childe, H, 2015 C).
clean restaurant in which the  Customers walking into a
décor is attractive and matches restaurant, even one like
to quality of the food and McDonald’s, they want and
matches the restaurants image expect to be acknowledged
(Morley, M, 2015). (Morley, M, 2015).
 Customers expect consistency  Family friendly with pricing to be
from store to store, location to in line with this and working
location (Work 911, 2013). people (Work 911, 2013).
 Although convenience is still  Although convenience is still
important in Pret’s market, the important in Pret’s market, the
food quality must be good (Work experience must be good (Work
911, 2013). 911, 2013).
Capability  Pret is capable through  Pret are capable of creating a
Of monetary resources to produce difference than in-home options
Competitive a selection of food that is by adding ingredients that
Advantage: considered delicious and well- differentiate from in-house
presented (VRIN #1). products (Childe, H, 2015 A)
 Pret ensure that there is more (VRIN #5).
than enough staff on in peak  Pret ensure staff are passionate
times to keep their stores in and are able to conduct great
clean, quality condition (VRIN quality service (Dudovskiy, J,
#2). 2014) (VRIN #6).
 All stores (apart from small  Through this experience, Pret are
differences to match location) capable of ensuring the
are all modelled in the same way experience is good, thus creating
to keep the Pret experience their competitive advantage
(VRIN #3). (VRIN #7).
 Pret has the capabilities to
ensure their food is quality with
the use of fresh food, made on
the day (VRIN #4).
Capability of Competitive Advantage applied in the VRIN Framework (Appendix 7):
#1 #2 #3 #4 #5 #6 #7
Valuable (i s it       
va l uable?)
Rare (i s i t ra re?)       
Imitable (i s i t difficult       
to i mi tate?)
Non-substitutional       
(other resources cannot
ta ke i ts place)

Macro Analysis:
Pret A Manger PESTEL Analysis:
Political factors: Economic factors:
 Pressure from environmental groups  People are not out of the ‘tightening
about recyclable packaging their belt’ stage because of this price of
(Environmental Protection Department, edible commodities (The Economist,
2010). 2008).
 British government on cracking down  The market is expanding and becoming
on targeting children with junk food dense, even though people still choose
(Williams, J, 2014). to eat at home as it’s the cheaper
option (Turchetti, C, 2012).
Social factors: Technological factors:
 Concerns with obesity (Malhotra, A,  People turn to their smartphone for
2014). health advice (Diana, A, 2014).
 Chinese people are starting to favour  Entrepreneurs and business alike how
western food (Kollewe, J, 2012). now started to develop 3D printed food
 Restaurant and fast food chains are (Wong, V, 2014).
training their employees to be ‘sellers’  With the World Wide Web, information
(Beaudoin, R, 2014). is easier to get a hold of and people are
 Consumers are becoming more and becoming more responsive to
more aware of the origins of the food information that may have been
products they buy, as well as its forgotten about or brushed off in the
cleanliness (South China Morning Post, past e.g. the viral video of McDonald’s
2013). manufacturing of McNuggets which
was false (Popken, B, 2014).
 There is now lab-grown beef which is
reportedly healthier than regular beef
(Kader, B, 2014).
Legal factors: Environmental factors:
 China is employing harsh and strict  If the use of water continues and
regulations on food safety (Baojie, L, increases at the rate it has been, by
Yao, z & Li, Y, 2014). 2050, it is reported 40% the world’s
 Regulations on calorie counts being population will be living in water-
shown on packaging (Zajac, A, 2011). stressed countries (UNEP, 2008).
 Sustainable farming.
Political factors: Meaning: Supporting reference:

Political factor 1 (PF1) Relating this to Pret, as their (Michelle, 2014)
(Pressure from environmental food is mostly packaged in
groups about recyclable plastic (to remain fresh and
packaging): hygienic) this could end up
being a problem. This is
because an increasing number
of pressure groups are pushing
the government to take action.
This could be threatening to
Pret as they may have to
invest in R&D to better their
product packaging to become

environmentally friendly, and

if they don’t, they could fall
short of the competition.
Political factor 2 (PF2) (British As Pret is a British business, (Michelle, 2014)
government on cracking down they could use the
on targeting children with junk governments push of obesity
food): awareness to start targeting
children but in a positive way
with their health friendly foods
and products. This is an
opportunity to increase the
awareness of their business
ethics as well as their company
image.
Economic factors: Meaning: Supporting reference:

Economic factor 1 (EF1) Relating the economic factor 1 (Michelle, 2014)
(People are not out of the to Pret, as they promote
‘tightening their belt’ stage themselves as healthy and
because of this price of edible freshly made snacks, these
commodities): obviously come at an extra
cost to the consumer. This can
be a problem as people aren’t
quite fully out of the saving
stage since the financial
meltdown and it poses a
challenge to Pret’s marketing
team to find ways to attract
consumers whilst avoiding the
obvious added cost that most
of their competitors do not
have.
Economic factor 2 (EF2) (The Bringing this back to Pret, this (Michelle, 2014)
market is expanding and means that they have to be
becoming dense, even though very careful when pricing their
people still choose to eat at products to not scare
home as it’s the cheaper consumers back to their
option): homes which is the cheaper
option. They also need to
ensure that their service
quality is top notch, which is
something they definitely
cannot get at home.
Social factors: Meaning: Supporting reference:

Social factor 1 (SF1) (Concerns For Pret, with their health (Michelle, 2014)
with obesity): conscious foods, this is an
opportunity to support these
pressure groups and standing
with them to gain not only
recognition through PR, but an

increase in the health

conscious buyer.
Social factor 2 (SF2) (Chinese As Pret has now entered the (Michelle, 2014)
people are starting to favour Chinese market, this is good
western food): news for them. It is an
opportunity now to push
further and open more stores
while this trend remains.
Social factor 3 (SF3) As Pret is a fast food chain, this (Michelle, 2014)
(Restaurant and fast food is an opportunity for their HR
chains are training their to really push their quality of
employees to be ‘sellers’): service (which is already
higher than the vast majority
of fast food chains).
Social factor 4 (SF4) With this new found interest (Michelle, 2014)
(Consumers are becoming of the origins of products from
more and more aware of the the consumers, Pret could link
origins of the food products in to social factor 2 (where
they buy, as well as its Chinese people are favouring
cleanliness): western food) and once again,
push forward in that market,
where the Chinese are willing
to pay a little extra for the
reassurance of quality food.
Technological factors: Meaning: Supporting reference:

Technological factor 1 (TF1) This factor could well become (Michelle, 2014)
(People turn to their a threat to Pret if their content
smartphone for health advice): of ingredients are not
monitored correctly and if
there is something found in
their food that has been
‘hidden’ or not clearly shown
that could possibly go against
their brand image. But on the
flip side, if these app’s find
that Pret’s food has what they
say it does, and does indeed
have health benefit, they could
use it as a marketing strategy
and increase awareness once
again on their healthy image.
Technological factor 2 (TF2) This could well be a threat or (Michelle, 2014)
(Entrepreneurs and business an opportunity again. Pret, if
alike how now started to they feel this has increased
develop 3D printed food): benefit, along with saving time
and money, could use this to
cut costs and boosts their
healthy image, but they could
stick with the handmade
everyday image that has

brought success throughout

the years. If they stick with the
latter, a competitor could
come in with 3D food, so they
will have to devise a marketing
strategy to ensure Pret is the
option among consumers.
Technological factor 3 (TF3) Relating back to Pret, as they (Michelle, 2014)
(With the World Wide Web, pride themselves on quality in
information is easier to get a all aspects, from the condition
hold of and people are of their outlets, their staff,
becoming more responsive to their service and their product,
information that may have they could use the World Wide
been forgotten about or Web to perhaps produce a
brushed off in the past e.g. the viral video to once again,
viral video of McDonald’s increase awareness of their
manufacturing of McNuggets brand and their healthy
which was false): products.
Technological factor 4 (TF4) As Pret promote their food as (Michelle, 2014)
(There is now lab-grown beef healthy and natural, they
which is reportedly healthier would most likely choose to
than regular beef): keep away from artificially
made beef, but this beef could
be used by a competitor, and
with the added health benefits
its reported to have, it could
be a threat to Pret and take
away some of their market
share.
Legal factors: Meaning: Supporting reference:

Legal factor 1 (LF1) (China is As China is a massive market, (Michelle, 2014)
employing harsh and strict and one Pret is now involved
regulations on food safety): with, these measures have to
be considered by the senior
levels of Pret, and ensure all
their products meet these
regulations because if they
don’t, it could be a disaster for
Pret in the Chinese market.
Legal factor 2 (LF2) Once again, relating back to (Michelle, 2014)
(Regulations on calorie counts Pret, this could be an
being shown on packaging): opportunity to furthermore
boost their brand image of
their healthy food.
Environmental factors: Meaning: Supporting reference:

Environmental factor 1 (EnF1) Although years away, as their (Michelle, 2014)
(If the use of water continues business is supported by
and increases at the rate it has farmers and the produce they
been, by 2050, it is reported make, if they happen to be

40% the world’s population affected with restrictions on

will be living in water-stressed water etc. they will be directly
countries): impacted.
Environmental factor 2 (EnF2) If the process of farming for
(Sustainable farming): Pret only lasts a few years, this
would be difficult for Pret to
keep finding new farmers. This
would once again have a direct
impact on Pret as a food
business. If the farms cannot
sustain themselves, then in-
turn, they cannot sustain Pret.

Competitive Analysis:
Porter’s 5 Forces (Appendix 8):
(195 Words)

Threat of new entrants Meaning: Impact/Urgency:

Threat of new entrants 1 Because of the high costs Low.
(ToNE1) (Pret operate in city direct from capital, such as
centres with high capital premises and fixed assets to
costs): start up a business in the
centre of London, it could
mean that the threat of an
entrant in this sense would be
low.
Threat of new entrants 2 Any new entrants, especially Low.
(ToNE2) (Pret have economies those that are not an already
of scale): established brand would have
to create economies of scale
to match Pret’s prices for the
quality of product and service
they provide. So once again,
for this section, a threat of
new entrants would be low.
Threat of new entrants 3 For this, as switching costs are High.
(ToNE3) (Pret have routine low for consumers in this
consumers with costs of market, routine customers
developing a brand high): aren’t that important, so the
threat of an entrant building a
consumer base is high, but as
for developing a brand that is
trusted by these consumers, it
will cost a lot to build that. But
even so, the threat of new
entrants for this part is high, as
they would have to start
building a brand.
Threat of new entrants 4 New entrants would have to High.
(ToNE4) (New entrants have to find a route to market,
find a route to market): through either outlets or
online. This may not be too
difficult for a new entrant, so
once again the threat is high.
Bargaining power of buyers: Meaning: Impact/urgency:

Bargaining power of buyers 1 As there is low switching costs Very high.
(BPoB1) (Low switching cost between competitors, at any
between competitors for the day, consumers could switch
consumers): between each one and have a
new choice every day, so for
this, the bargaining power of
buyers is very high.
Bargaining power of buyers 2 Linking in to Bargaining power Extremely high.
(BPoB2) (There are a large of buyers 1, as there it costs
amount of competitors that nothing to switch from
consumers can choose from): competitor to competitor, the
power of buyers is high, plus

with the fact that there are

many competitors to choose
from, this only increases the
bargaining power of buyers to
extremely high.
Bargaining power of buyers 3 Linking both Bargaining power High.
(BPoB3) (There is a lot of of buyers 1 & Bargaining
available substitutes such as power of buyers 2, there is a
other food outlets or even lot of cheaper substitutes,
cheaper option of home eating from home being one.
eating): So once again, this only
increases the bargaining
power of buyers.
Threat of substitute products: Meaning: Impact/urgency:

Threat of substitute products Taking from Bargaining power High.
1 (ToSP1) (Plenty of of buyers 3, there are plenty
substitutes within Pret’s of substitutes such as eating at
market): home, so this threat of
substitutes is high.
Threat of substitute products Taking from Bargaining power High.
2 (ToSP2) (Low switching costs of buyers 1, there is low
for consumers): switching costs from
consumers in the market, so
once again, it increases the
threat of substitutes.
Threat of substitute products Crucially, most of Pret’s Low.
3 (ToSP3) (Most importantly, competitors have high
many competitors have high performance-to-cost ratio, so
performance-to-cost ratio): they can match Pret’s
performance, whilst keeping
their costs low to perhaps
undercut Pret’s pricing, which
once again, increases the
threat of substitutes if their
competitors had much
cheaper prices.
Bargaining power of suppliers: Meaning: Impact/urgency:

Bargaining power of suppliers As Pret have a choice of a large Very low.
1 (BPoS1) (Large number of number of suppliers, Pret
suppliers for Pret): could pick and choose the
suppliers they want, meaning
the bargaining power of
suppliers is very low.
Bargaining power of suppliers Because there is low forward Low.
2 (BPoS2) (Low forward integration, meaning the
integration, but as seen, Pret suppliers don’t have much say
does have strong relationships or input in any processes and
with their farmers): operations beyond their own,
it means that Pret only need

them for the raw materials.

This once again means that
Pret’s suppliers bargaining
powers are low.
Bargaining power of suppliers Lastly, as there is a relative Very low.
3 (BPoS3) (There is a relative abundance of available
abundance of the produce produce needed for Pret’s
needed for Pret’s food): product, their suppliers can’t
demand high prices or clauses
in the contracts. Once again,
leaving the bargaining powers
of suppliers being very low.
Competitive rivalry: Meaning: Supporting reference:

Competitive rivalry 1 (CR1) As there is a high number of High.
(High number of large firms competitors in the market,
within the market): there is inevitably a high
competitive rivalry.
Competitive rivalry 2 (CR2) Adding to this, the firms in the High.
(Bearing in mind the firms in market are all very aggressive
this market, they are all when targeting and acquiring
extremely aggressive): their consumers, once again
meaning that the competitive
rivalry in this market is high.
Competitive rivalry 3 (CR3) Once again, linking back to High.
(Low switching costs within bargaining power of buyers 1
the market): & Threat of substitute
products 2, there is low
switching costs within the
market, meaning competitors
are fighting tooth and nail to
acquire and get consumers
while devising plans to keep
their consumers.

Environmental matrix:
(34 Words)
Barry Stuck - 21315816

Interpretation and analysis of the environmental matrix:

From the environmental matrix, as shown, the high urgency and high impact factors are
encompassed by a red border. The high urgency, high impact factors include ToNE4, SF2, CR1,
EnF2, EF2, BPoB1, ToSP2, CR3, BPoB3, ToSP1, LF1, BPoB2, and CR2.
This is showing that Pret should highlight ways to stop new entrants have to finding a route
to market, or at least a way that overshadows and pushes on their market share. Not only this,
but as Chinese people are starting to favour western food, it is a chance for Pret to push further
into this market before their competitors, this is urgent because if they wait too long, then
competitors will jump into the market, and overall this will have a huge impact on Pret. Moving
on to CR1, and the fact that there are a high number of large firms within the market, it is an
urgent matter than Pret keeps themselves and the quality of their product in front of these firms,
because if competitors start taking their market share, this will have a dire impact on Pret. Pret
also need to highlight sustainable farming, as shown throughout this report, consumers are
becoming more and more concerned with the origins of their food, how their food is produced
and the treatment of the farmers, so keeping a sustainable farming process is key. This is urgent
because if it isn’t sustainable, Pret will need to find a new product soon, which once again, has a
huge impact on Pret as a whole. Moving on to the fact the market is expanding and becoming
dense, even though people still choose to eat at home as it’s the cheaper option, it means Pret
really have to establish themselves as a different option to their competitors and substitutes. This
is once again urgent because if Pret slack on this, it will have a huge impact on them. Moving o n to
BPoB1, ToSP2 and CR3, these all highlight the fact there is low switching costs between
competitors, this is massively urgent for Pret to stop their consumers switching with effective
marketing and quality service/product. If Pret fail to stop their consumers switching, then this will
once again impact Pret negatively. Now for BPoB3 and ToSP1, this highlights the huge number of
substitutes in the market, such as competitors and eating at home. Once again this is urgent to
deal with and impactful to Pret for obvious reasons, taking the low switching costs of BPoB1,
ToSP2 and CR3 and showing there is a lot of things to choose from other than Pret that could be
potentially a lot cheaper.
Moving on to the key 3 urgent and impactful factors of the environmental matrix that are
LF1, BPoB2 and CR2. Starting with LF1, which highlights that China is employing harsh and strict
regulations on food safety. This is massively urgent as Pret has only recently moved into the
Chinese market, so any failure to meet these regulations could result in a public relations incident
that could potentially be so impactful to Pret’s image that it may not be able to ever push back
into the Chinese market. Secondly, for BPoB2 which highlights the fact there is a large amount of
competitors that consumers can choose from, this is massively urgent for Pret to keep on their
marketing push and their quality of their products, because if they slip at all, their consumers will
switch to any number of their competitors which once again, could have a massively negative
impact. Lastly, for CR2, which is considered the most important issue for Pret from the
environmental matrix, which focuses in on the fact that the majority of the firms in this market
are all extremely aggressive, this is a hugely important and urgent factor for Pret as is they
hesitate on any of their processes and daily activities, one of their extremely aggressive
competitors will have pushed in and taken market share and consumers quicker than Pret could
react. This will be massively impactful on Pret in every way imaginable.
These factors will be touched on and improved upon when devising the 2 strategies for
Pret to advance on and proceed with.

Pret A Manger SWOT Analysis:

Internal:
Strengths: Weaknesses:
 Pret A Manger is Britain’s leading  BPoB1 (Low switching cost between
sandwich chain with an enviable competitors for the consumers).
reputation for service (Cook, S, 2015).  ToSP2 (Low switching costs for
 10th best company to work for in the UK consumers).
(Cook, S, 2015).  CR3 (Low switching costs within the
 LF2 (Regulations on calorie counts market).
being shown on packaging).
 EnF2 (Sustainable farming).
 ToNE1 (Pret operate in city centres
with high capital costs).
 ToNE2 (Pret have economies of scale).
 ToNE3 (Pret have routine consumers
with costs of developing a brand high).
 BPoS1 (Large number of suppliers for
Pret).
 BPoS2 (Low forward integration, but as
seen, Pret does have strong
relationships with their farmers).
Opportunities: Threats:
 SF3 (Restaurant and fast food chains  TF2 (Entrepreneurs and business alike
are training their employees to be how now started to develop 3D printed
‘sellers’). food).
 TF2 (Entrepreneurs and business alike  EnF1 (If the use of water continues and
how now started to develop 3D printed increases at the rate it has been, by
food). 2050, it is reported 40% the world’s
 LF2 (Regulations on calorie counts population will be living in water-
being shown on packaging). stressed countries).
 BPoS1 (Large number of suppliers for  EnF2 (Sustainable farming).
Pret).  BPoB1 (Low switching cost between
competitors for the consumers).
 ToSP2 (Low switching costs for
consumers).
 CR3 (Low switching costs within the
market).
External:
Strengths: Weaknesses:
 SF2 (Chinese people are starting to  EF1 (People are not out of the
favour western food). ‘tightening their belt’ stage because of
 SF4 (Consumers are becoming more this price of edible commodities).
and more aware of the origins of the  TF3 (With the World Wide Web,
food products they buy, as well as its information is easier to get a hold of
cleanliness). and people are becoming more
 LF2 (Regulations on calorie counts responsive to information that may
being shown on packaging). have been forgotten about or brushed
 ToNE3 (Pret have routine consumers off in the past e.g. the viral video of
with costs of developing a brand high). McDonald’s manufacturing of
McNuggets which was false).

 BPoS1 (Large number of suppliers for  BPoB1 (Low switching cost between
Pret). competitors for the consumers).
 BPoS3 (There is a relative abundance of  BPoB2 (There are a large amount of
the produce needed for Pret’s food). competitors that consumers can
choose from).
 BPoB3 (There is a lot of available
substitutes such as other food outlets
or even cheaper option of home
eating).
 ToSP1 (Plenty of substitutes within
Pret’s market).
consumers).
market).
Opportunities: Threats:
 PF2 (British government on cracking  PF1 (Pressure from environmental
down on targeting children with junk groups about recyclable packaging).
food).  EF2 (The market is expanding and
 SF1 (Concerns with obesity). becoming dense, even though people
 SF2 (Chinese people are starting to still choose to eat at home as it’s the
favour western food). cheaper option).
 TF1 (People turn to their smartphone  TF1 (People turn to their smartphone
for health advice). for health advice).
 TF2 (Entrepreneurs and business alike  TF2 (Entrepreneurs and business alike
how now started to develop 3D printed how now started to develop 3D printed
food). food).
 TF3 (With the World Wide Web,  TF4 (There is now lab-grown beef which
information is easier to get a hold of is reportedly healthier than regular
and people are becoming more beef).
responsive to information that may  LF1 (China is employing harsh and strict
have been forgotten about or brushed regulations on food safety).
off in the past e.g. the viral video of  EnF1 (If the use of water continues and
McDonald’s manufacturing of increases at the rate it has been, by
McNuggets which was false). 2050, it is reported 40% the world’s
 LF2 (Regulations on calorie counts population will be living in water-
being shown on packaging). stressed countries).
 BPoS1 (Large number of suppliers for  ToNE4 (New entrants have to find a
Pret). route to market).
 BPoB1 (Low switching cost between
competitors for the consumers).
 BPoB2 (There are a large amount of
competitors that consumers can
choose from).
 BPoB3 (There is a lot of available
substitutes such as other food outlets
or even cheaper option of home
eating).
 ToSP1 (Plenty of substitutes within
Pret’s market).


consumers).
 ToSP3 (Most importantly, many
competitors have high performance-to-
cost ratio).
 CR1 (High number of large firms within
the market).
 CR2 (Bearing in mind the firms in this
market, they are all extremely
aggressive).
market).
Critical analysis of SWOT:
One clear point from this SWOT analysis of Pret is the number of threats they have. Not only this but
the amount of external factors that influence them that they may not necessarily be able to control,
things such as having a lot of competitors, substitutes and economic negativities. For the good, as
shown in the internal and external SWOT’s of Pret, there is a lot of strengths and opportunities. This
is good for Pret as they can work on these in new strategies, things such as calorie counts on
packaging. If Pret’s products are as good as they say, then it is a massive opportunity to plaster this
on their packaging as well as their stores.
Overall, taking from the SWOT analysis, they have a lot of strengths and opportunities that
they can push on with, but they also have a huge amount of threats with weaknesses. These threats
and weaknesses could be used in new strategies to be improved upon or removed completely. If not
removed completely, a few key ones such as CR1, CR2 and CR3 need to be acted upon. Even though
they are external and not always directly influenced by themselves, they can do their best to ensure
their customers do not want to switch.

Strategic Planning:
Porter’s Generic Competitive Strategies (Appendix 5):
Application of Porter’s Generic Competitive Strategies taken from the content of Pret’s SWOT
analysis:
Current position in Porter’s Generic Competitive Strategy model:
Currently, Pret would be placed in differentiation on the Porter model and this is because Pret
focus on quality throughout to be different and more attractive from their competitors. Pret has
done this by researching their produce well, developing their products as well as their staff’s
service and innovating their products to things such as their Kale crisps and incorporating
cauliflower into their products.
Secondly for Pret being on the differentiation part of the model, they have focused and
delivered on high-quality services and products that have pushed Pret to one of the best chains in
the UK. This helps when placing Pret onto the focus differentiation because they focus on quality
and then go and deliver it.
The only thing that hangs a question about their differentiation is the effective sales and
marketing so that benefits of Pret are clearly shown through the market consumers. Directors of
Pret have said that they are effective at marketing, even without using advertising (Hobbs, T,
2015).
Strategy number one in Porter’s Generic Competitive Strategy model:
For strategy number one, this involves pushing hard into China to be a first mover within the
market when it comes to western food and the healthy lifestyle of Pret.
Taking from the external SWOT strength of SF2 and the external opportunity of SF2. SF2
highlights that Chinese people are now starting to favour Western food and with Pret only outlets
in Hong Kong and Shanghai, around 17 altogether, there is most definitely room for them to push
harder into this market. If they do push and push hard and aggressive life their competitors do,
shown with CR2, they could really grab a good hold of the market as it grows to maturity and with
the increasing white collar workers, wanting the Western lifestyle and Western health rage.
This strategy will also help turn the external threat of LF1, which is the harsh restrictions
and penalties on failing to meet the Chinese regulations on food into a positive and a way to push
Pret into the market further. If they use these restrictions, meet them and meet them with flying
colours, the certificates/awards and verifications that they get from the Chinese government
could be plastered all over their product packaging and shops as well as advertising if Pret decide
to do that in the Chinese market.
This would keep Pret in the differentiation part of the model as they won’t be changing
their values and USP too much, apart from perhaps a more Chinese culture friendly selection of
food, but even that won’t be changed too much as it has been found by SF2 that Chinese people
want Western food.
Strategy number two in Porter’s Generic Competitive Strategy model:
Now for strategy two, this involves Pret partnering with a fitness app such as FitBit, FitStar or
MyFitnessPal to create a mobile application for both iOS and Android, to be available to the
majority of smartphone users and push forward with external threat and external opportunity of
TF1 which highlights that more and more people are turning to their smartphone for health
advice.
Through this mobile app, Pret could offer incentives for thing such as number of miles
run, number of calories burnt as well an incorporating a loyalty card within the app, that could be
scanned in store, or a code to type online when getting an online order or delivery to the office.
As well as this, they could have selective, but minimal advertising on the app for fitness products
such as thermals and running shoes so that the producers of these products can target the same
segment of customer that Pret has as they match.

This app might help curve CR1, CR2 & CR3 which all highlight the number of large firms in
this market, that fact their all aggressive and the low switching costs for the consumers
respectively. This app could give them a reason to stay with Pret and to stop switching to another
firm within the market.
This might eventually push Pret into focus differentiation on this model but most likely
will stay as differentiation, as Pret have branched out further from eating out/fast-food to now
mobile apps. This would show aggression and hopefully curve some interest consumers may have
to switch to a competitor. It would also help push their customer segmentation to the healthy
lifestyle and white collar workers who like to be health conscious and have smartphones for their
daily use. An added bonus of this strategy is the fact that it could potentially add another revenue
stream from the ads shown on the application itself. The key here for Pret is to not flood the users
with ads, as this would put off many potential customer and user of the app.
Plotting Pret a Manger on Bowman’s Strategy Clock (Appendix 5):
Key:
RED =
Current
positioning of
Pret.
GREEN =
Strategy
number one
positioning of
Pret.
GOLD =
Strategy
number two
positioning of
Pret.

Business Canvas Model:

Pret A Manger Strategy One:
(476 Words)
Is this going to require a For strategy one, it doesn’t necessarily mean that Pret need a new
new or existing vision vision statement, it just means they need to extend and expand their
statement for Pret A current one. Adding in the vision of seeing themselves as the number
Manger? one choice for Western food when eating out would be a very good
and ambitious target/vision for them within the next 5 to 10 years in
A vision statement is a that market. More realistically though, Pret can add to their vision
description of what and statement by adding that their vision is to be one of the top 5 choices
where the business for Western food in the Chinese market, with a similar market share
aspires to be, achieve and to the UK of 16%, with efficient and smooth operations to ensure
accomplish in the mid to profitability within the country.
long term future
( Business Dictionary,
2016).
What is the mission The mission really sets out what Pret want to and will aim to achieve.
going to be with Strategy So for Pret with Strategy One, this will link in the end of the improved
One for Pret A Manger? vision statements where they will achieve profitability within the
Chinese market using efficient and smooth operations to do so. Pret
A mission statement is an will also be setting their mission to achieve a high market share in the
organisations core Chinese market, so the brand awareness increases, consumers
purpose and largely choose them and in turn, if the overheads are covered, creating
remains unchanged for profitability. Within the first couple of years Pret should understand
long periods of time and that even though their mission is to be profitable in the Chinese
is there to filter out what market, that due to the high capital costs of setting up outlets in city
is important and what is centres as well as finding the best distribution in routes to their
not, to clearly state what stores, it is almost certain they will not gain a profit for now, but
markets will be served that’s not to say with the aggressive stance of their competitors in
and to create a sense of this market, they cannot turn a profit in a few years within this
direction for the market.
organisation as a whole Another thing Pret may want to include in their mission
(Business Dictionary, statement is the idea and aim to ensure sustainable farming, both in
2016 A). A mission their PretFarmer and FarmerPret relationships as well as the
statement is different produce being farmed. Because without these being shown in the
from the vision and as the statements of Pret, the lines could be blurred between them and
mission statement is the their competition by the Chinese people, something that could have a
cause and the vision is negative impact on Pret.
the effect (Business
Dictionary, 2016 A). A
mission is something that
is there to be
accomplished and a
vision is there to be
pursed to gain that
accomplishment
(Business Dictionary,
2016 A).
How are Pret going to do Currently, Pret has opened roughly 17 stores in China. Now, if Pret
all this (explaining the adopted the aggressive stance like their competitors and aimed to
strategy in more detail): double outlets year on year, they could have 136 outlets in the next 3
years. This would take a massive amount of capital that could be
A strategy statement is a gained from reinvesting their reported profits of £76m or could float
succinct description of on the stock market like that have been teasing with in the last

what the organisations couple of years. They would clearly need more than £76m, but with
core strategy is and what the profits for the next two years, as well as perhaps a loan to gain
opportunities they will be more capital funds, this idea of doubling year on year is not out of
exploiting and what risks reach for Pret.
they aim to avoid As for their farming and distribution in to their stores for
(Business Dictionary, produce, Pret will have to do hands on research about the best
2016 B). couriers as well as the best routes for the produce to be delivered in
their stores. An estimated guess would say that either way, it would
be cheaper than say delivering in London on New York but
nevertheless, it will be expensive, so finding the best routes and
creating good relationships would be something Pret would need to
do when aggressively pushing into major cities in China.
Lastly, as shown in the canvas model, both the original and
for Strategy One, Pret haven’t used regular advertising and instead
opt for using social media to attract its consumers and the segment
of the market they choose to target whilst using in store ads on things
such as free Wi-Fi. So if they do want to adopt the aggressive stance
of attacking the Chinese market with meaning, they may want to
invest in some heaving TV advertising and music streaming services
to really access the market.
If all three of these segments of Strategy One is done well
and efficiently, it could really be a profitable venture for Pret, but one
thing still remains, they would definitely need to invest funds into
R&D to research the Chinese culture as well as developing their brand
to be in line with this culture. Once done, and all is set to go, Pret
need to push aggressively and it could well be extremely efficient and
profitable for Pret.

Pret A Manger Strategy Two:
(618 Words)
Is this going to Once again, it is more evolution not revolution with Strategy Two for Pret
require a new or A Manger. Pret could quite easily keep their existing vision statement and
existing vision just evolve it to add in the added technological factor of the mobile
statement for Pret A application. To do this, throughout their vision statement, Pret would
Manger? have to clarify that is now aims to be the number one stop for the health
conscious and the active among their consumers. Not only this, but they
would aim to incorporate all existing loyalty activities into this application
through either an eLoyaltyCard or through incentives such as a free hot
drink per X amount of miles ran.
What is the mission Now, for Pret’s mission statement, it will be to create the number one
going to be with choice in health and fitness applications throughout its consumer base
Strategy One for whilst maintaining a strong partnership with a company who really
Pret A Manger? understands that market such as FitBit. This will once again be extended
onto their current mission statement.
Their mission will also be to provide an accurate and efficient
mobile application and not just one used for novelty and purely for
incentives given my Pret. This could increase the potential purchasing
(whether free or not) from consumers that are outside of Pret and the
people who are just in general, quite active and healthy, which in turn
could attract even more consumers to Pret as they really understand and
get a feel for what Pret are trying to push.
Lastly, Pret should include in their mission statement that they will
create an ad platform that isn’t intrusive with data and doesn’t put people
off but can add another stream of revenue to the business. The key, as
mentioned is for Pret to create an ad platform where fitness companies
and health conscious companies can advertised on and access their target
market directly but without making the advertising overwhelming to the
consumer which may put some people off. It will be difficult, but if Pret
put forces behind it and the aggressive stance to excel and be successful
as shown by their competitors as well as Strategy Two, then it can be
done.
How are Pret going Currently, Pret isn’t in the health and fitness mobile application market at
to do all this all so all of this Strategy Two will be completely new and unique to each
(explaining the person involved with development of this. That market is becoming more
strategy in more and denser, but if Pret choose the right partner, such as FitBit, they have
detail): both their own brand and FitBit’s to be straight at the forefront of the
consumers eye, which is a massive added bonus.
As for the partner, FitBit is a well-known player in that market so
is being used an example, but there is a range of applications that do the
same job as FitBit and are just as good, if not better so it will really be a
challenge for Pret to find the best partner for them, but it is something
that needs to be done to the highest of quality as to make sure the
application itself doesn’t just turn into a novelty, and something that isn’t
useful to the consumer, because this could be negatively impactful on
Pret’s image and products.
The application itself will have to be of use to the consumer,
giving them a reason to use it for the health and fitness tracking and not
just for the incentives. So linking back into the partner, it is key that they
find a partner who knows exactly what they’re doing and have the skills,
knowledge and technology to create a ‘PretFit’ or ‘Fit A Manger’ mobile
health and fitness advice and tracking that can track their progress as well

as incorporate calorie counting technology so the consumers can really

track themselves how many they’re eating if this is something that is
important to them.
Now for the incentives on the application, Pret could potentially
offer a reason to use the application that is beyond just the health and
fitness advice and this could potentially turn into taking consumers from
their competitors and as an added bonus to the consumer, can add a
slight amount of motivation as they will working towards something such
as a free coffee/sandwich/meal. This is something that no of their
competitors are doing and it’s something that many of their competitors
cannot do as they don’t offer the healthy, fresh produce that Pret do. Add
the eLoyaltyCard idea in for regular customers who don’t always do the
fitness incentives to get free drinks means that Pret won’t be excluding
one side of or the other of their consumers, incorporating the health
conscious and the white collar workers both at the same time.
Altogether, this application could make people talk, and if people
talk well of Pret with the health bonuses and incentives, then it could
massively pay off for Pret. It is well known that word-of-mouth is one of
the strongest marketing tools so if Pret really crack this mobile application
through having a quality application that offers all what is needed such as
progress reporting and calorie counting, for the health and fitness
consumers in the market, then Pret could really push high up into the
market, adding more consumers from their rivals and creating a new
platform for people to integrated into the Pret lifestyle. This app could be
worldwide if it is in line with regulations so it could potentially link into the
Strategy One where Pret is aiming to push aggressively into the Chinese
market.
Critical discussion of the relation between Strategy One & Two with Pret’s current SWOT analysis
& strategic capabilities:
Strategy One:
Strategy One which is pushing aggressively into China, relates back to Pret’s SWOT as it derives
straight from SF2 which highlights that Chinese people are starting to favour Western food, so
straight away, pushing aggressively into China makes sense. Strategy One also adopts traits shown in
CR2 which states that competitors in Pret’s market act aggressively and it is something that Pret will
definitely have to do in the Chinese market. Lastly for Strategy One and it’s relation to Pret’s SWOT,
it will hopefully help turn LF1 which is the Chinese regulations on food into a positive. If Pret pass
regulations with flying colours, there would be the opportunity to show this to the public.
As for the strategic capabilities, Pret in Strategy One would have to keep the
capability/resources of the expectation of good selection of food, clean restaurants and consistency
along with keeping the convenience to break the Chinese market, and keep the Western feel the
Chinese want. They will also have to keep the competitive advantage/resource of monetary
resources to set up in China, staff able to handle the Chinese peak times, the décor matching Pret’s
Western feel and the quality, fresh food. As for the threshold capabilities/competences, Pret will
have made the difference from in-home options for the Chinese people, they’ll keep the service at a
high quality and pricing to be in line with the Chinese market. For the competitive
advantage/competences, Pret will once again keep the differences from in-home options and will be
passionate in doing so, creating once again the Western.
Strategy Two:
As for Strategy Two and Pret’s current SWOT analysis, it takes TF1, that shows that more and more
people are turning to their smartphones for health advice, and turns it into an idea of creating at app

to handle the increase in people doing this. This mobile application is also hoping to curve the
negatives of CR1 which shows that there is a large number of large firms in this market, CR2 which
states they are all very aggressive and CR3 which shows there are low switching costs within the
market. If this app can attract consumers from their aggressive competitors, then it will curve all
three of these SWOT factors, even if it was a minimal amount.
Now for Strategy Two and Pret’s strategic capabilities, for the threshold/resources, they will
keep everything from the selection of foods to their consistency and this consistency and quality will
need to transfer over in the mobile application. As for their competitive advantage/resources, once
again Pret will keep everything as add the app resource to the list as it will be a competitive
advantage as their competitors do nothing like this. For threshold capabilities/competences, fo r the
third time, they will keep all to keep the differences from in-home options as well as the
convenience and once again, these strategy capability traits will be transferred into the mobile
application. Lastly for the competitive advantage/competences, all we be kept with the addition of
the quality mobile application to ensure the experience on this application will match that of their in
store experience, which is quality all round.
SAFe Analysis:
Strategy One:
Suitability: Does the proposed strategy address the key opportunities and threats
that Pret faces? Does it support the purpose and objectives? Is it suitable
for competitive position and lifecycle? Does it make the best use of their
competitive advantage?
As mentioned, Strategy One addresses the external SWOT threat and
external SWOT opportunity of SF2, as well as the external SWOT threats
CR2 & LF1. It also supports the purpose and objectives of Pret which are to
create an experience with great food, great services and great locations.
As for the competitive position and lifecycle, this will massively strengthen
their competitive position in China if they push aggressively and will aim
to expand their lifecycle as well as push them high up through growth.
Lastly, as Chinese people are now favouring Western food, it definitely
holds well with Pret’s competitive advantage.
Acceptability: Does a proposed strategy meet the expectations of stakeholders? Is the
level of risk acceptable? Is the likely return acceptable? Will stakeholders
accept the strategy?
This strategy would meet the expectations of stakeholders, from
governments wanting businesses founded in their country to expand
overseas to increase the reputation of the country, staff would be excited
to see the company they work for is expanding with perhaps some
opportunities to people to bring the Western feel in the new Chinese
stores. The level of risk for this strategy would be massive, with huge
amounts of capital expenditure if they really do push aggressively into the
Chinese market, so the acceptability would be difficult to overcome but
moving on to the acceptability of return, this would definitely be
accepted. The level of return may outweigh the risk as the size of the
Chinese market is massive and if Pret manage to get a solid foothold on
the market, the profits could be huge.
Overall I think the stakeholders would accept the strategy as it
would meet expectations and the level of return will outweigh the level of
risk that would be incurred should Pret go ahead with the strategy.

Feasibility: Would the proposed strategy work in practice? Can the strategy be
financed? Do people and their skills exist and can they be obtained? Can
the required resources be obtained and integrated?
The proposed strategy would work in practice as it takes all of what Pret
knows, adding what they research about the Chinese culture and placing it
in the Chinese market, and with the knowledge that Chinese people are
now favouring Western food it all points to working. As for the financing,
Pret would need a lot more than just their underlying profits of £76m to
expand aggressively into the Chinese market when considering shop
locations, PPE (plant, property & equipment) and setting out distribution
links to and from farmers in the region. They also would need the money
to advertise heavily which is suggested for Pret when moving into the
Chinese market. The skills are all set in place from their current business
activities and the resources can be obtained and integrated as they are
doing this strategy, but on a smaller scale, whereas this strategy is to scrap
that and push aggressively into the Chinese market.
Strategy Two:
Suitability: Does the proposed strategy address the key opportunities and threats
that Pret faces? Does it support the purpose and objectives? Is it suitable
for competitive position and lifecycle? Does it make the best use of their
competitive advantage?
Strategy Two take into account the external SWOT threat and external
SWOT opportunity of TF1 as well as all the external threats of competitive
rivalry CR1, CR2 & CR3. It also supports the purpose and objectives of Pret
with quality all round by making a quality mobile health application that
caters for the health conscious consumers that are actively targeted by
Pret. As for the competitive position, it would position them massively in
front of their competitors, especially in terms of customer interaction and
for Pret’s lifecycle, it could only extend it. This strategy wouldn’t shorten
Pret’s lifecycle because if it fails, as it’s separate from their core business,
it won’t impact in store sales. It definitely makes use of their competitive
advantage as their current competitive advantage is quality, fresh, healthy
food and to transfer this into a mobile application to have incentives to go
to Pret and to be fit as well as counting the calories on food could only
have a positive impact. If a customer used this on a competitor product
such as McDonalds or Greggs and physically saw the difference on their
smartphone in terms of calories, they could turn to Pret instead. So this
application could massively further Pret’s competitive advantage.
Acceptability: Does a proposed strategy meet the expectations of stakeholders? Is the
level of risk acceptable? Is the likely return acceptable? Will stakeholders
accept the strategy?
The proposed strategy may not meet the expectations of their stakeholder
as it is moving significantly away from their core business activities but
stakeholders may find some comfort in the fact that failure in this venture
won’t cost millions of pounds and failure in this venture won’t harm in
store purchases. As for the level of risk and asking the question of if it is
acceptable, it definitely is. For a high quality application, it is between
£100,000 - £200,000 to create and to create one of the level of Instagram
and Facebook so this would be the only real capital investment needed
from Pret which is significantly less than what would be needed to head
aggressively into China. After the capital investment, all Pret would need

to pay for is a maintenance team as well as expanding their customer

service team and as this is all salary or per hour based with many probably
on 0 hour contracts, even this isn’t too much a problem to remove if the
worse happens and the mobile application fails. As for the return, this
would also be acceptable as Pret can take consumers away from
competitors as it can attract them for the health benefits as well as the
incentives side of things can attract consumers or keep consumers who
may consider switching to a competitor. In the face of it, stakeholders
would accept it because although it ventures away from their core
business activities, the risk is low and the return is high, so there is no
reason as to why the stakeholders wouldn’t accept Pret for giving it a go.
Feasibility: Would the proposed strategy work in practice? Can the strategy be
financed? Do people and their skills exist and can they be obtained? Can
the required resources be obtained and integrated?
The proposed strategy would work in practise as Pret would gain a
partnership with a company that has the skills and knowledge as well as
the technology to be able to make this venture work. As for the financing
of this venture, that could definitely be achieved through the underlying
profits made from last of £76m. When looking at a high quality mobile
application costing roughly £200,000, it looks a very small amount. As
mentioned, as Pret will be creating a partnership with a company such as
FitBit, they will have the skills and knowledge available which will be
transferred when the partnership is set in stone. Lastly, for the resources
and whether or not they can be obtained, all the resources can be
obtained purely from the underlying profits of £76m. So the financing is
done and all the skills and knowledge can be obtained through the
partnership that will be created from the partner who knows their market.
Critical comparison of Strategy One & Two using SAFe:
Starting with suitability, Strategy Two covers more of the SWOT opportunities and threats than
Strategy One covers and supports Pret’s purpose and objectives. Strategy One would take this
section as this strategy sticks more to the core objectives of Pret than Strategy Two is and its more
about expanding aggressively at what they already do. Once again for the competitive position and
lifecycle, Strategy One takes it as they are using what they already know to push themselves into a
foreign market and to expand their brand lifecycle. Strategy Two also does this, but as they are
moving into a completely new market, it makes it a little less suitable to their core values. Lastly,
Strategy Two makes best use of Pret’s competitive advantage as it is taking the advantage of
healthy, low calorie food into a new market and pushing it further into a mobile application for
people to track their calories and health activities. So overall, the two strategies are tied for
suitability for Pret to take on.
As for meeting the expectations of stakeholders, once again, Strategy one pushes out
Strategy Two purely because of Pret are sticking to their core business activities. As for the level of
risk that is acceptable, Strategy Two massively outweighs from Strategy One from the significantly
less capital expenditure. Now for the likely return and what is acceptable, Strategy One offers high
revenues from a massive Chinese market, but Strategy Two hopes to curve the competitive rivalry
forces so for this part, they are both tied. Finally for acceptance from the stakeholders, both would
be tied again. This is due to Strategy One sticking to their core business activities and could earn
them a lot of high revenues, but Strategy Two has a sizable difference in risk and can also turn heads
away from their competitors. More than likely, Strategy Two would take the acceptability due to the
massive reduction in risk.
For the strategies working in practice, Strategy One would as its taking what they already
know and placing it in China whereas Strategy Two would also work due to having a partner with the

skills, knowledge and technology to develop an app and track fitness. Now for financing, Strategy
Two definitely takes this one as it would only cost a sliver of their underlying £76m profits whereas
Strategy One would cost a considerable much more than their underlying profits and this could be
something that may hinge on choosing between the strategies. For the skills existing and whether or
not they can be obtained, this is even for Strategy One and Two as Strategy One its taking what Pret
already knows and Strategy Two is taking from skills available from a potential partner of theirs.
Finally, for the resources and whether or not they can be obtained and integrated, Strategy Two
once again overcomes Strategy One because the financial resources are there and the rest of the
skills and knowledge can be taken from a partner, hence partnering with them. But for Strategy Two,
Pret really has to find a significant amount of financial injection as well as ensuring the culture and
services remain Western but also account for the Chinese culture as to not offend or disturb any
potential consumers which could end up creating a negative brand image for Pret in China.
Overall, Strategy Two pushes out Strategy one when comparing the SAFe analysis, because
Strategy Two is tied for suitability, takes the advantage in acceptability due to the significant smaller
capital expenditure and pushes our feasibility due to it being able to be financed more than
anything.
Strategy Pret should choose and the reason why:

It’s difficult choice, as Pret can go for either Strategy One or Two and could fail or succeed at polar
opposites. Failing expensively but succeeding massively for Strategy One and failing minimally but
succeeding at a hugely smaller scale for Strategy Two, although there is potential for the app to help
growth elsewhere in the world and that is why Pret should choose to go with and push Strategy Two.
Strategy Two aims to cover more important factors of the SWOT analysis than Strategy One
does and also aims to curve some of the massively impactful CR1, CR2 & CR3, whereas Strategy One
covers three also, but three that can be seen as less impactful. If Strategy Two could at even the
smallest of scales turn the CR1, CR2 & CR3 factors on their side, it could be massively beneficial
when attracting consumers from their large competitors and also keeping consumers there is zero
switching cost to the consumer.
Strategy Two also incorporates all of what Pret already knows, carrie s on their market push
in China, albeit at a more organic growth which is Pret’s current strategy rather than aggressive as
suggested by Strategy One and puts it all into a mobile application where current consumers can
track their health and fitness progress, count calories and for the less active people, still gain loyalty
bonuses from an eLoyaltyCard. For the reason that Pret is already in China, is another strike again
Strategy One, as it is doing what they are currently doing. Strategy Two really branches Pret out and
accesses more people in their current markets which they have cracked so far successfully so it is a
massive risk to push into another foreign market so aggressively, especially when taking into
consideration the way Pret failed when entering the American market.
Overall, the mobile application of Strategy Two has massive potential to become a massive
success for consumer numbers as well as ad-revenue and in-turn attract consumers away from
competitors which will help lower the urgency and impact of the competitive rivalry factors in
Porter’s 5 Forces Model. If Pret unfortunately fail with this venture, they would love a maximum of a
couple million pounds, whereas the aggressive push in China is a considerable amount more, one in
which Pret will need financing externally as they do not have the cash available to do. This is another
reasoning behind choosing Strategy Two for Pret. Strategy Two does depend on gaining a partner
with the right skills, knowledge and technology but there are a lot of players in the health and fitness
market with mobile applications that Pret can pitch to and with a well -known brand image, Pret
shouldn’t find it too difficult to find a partner and once found, with two well -known brands behind a
quality mobile application, all signs point to an extremely successful mobile fitness and health
application that people with not just an interest or stake in Pret, but fitness as a whole could enjoy
and use.

References:
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http://en.people.cn/90882/8556374.html. Last accessed 04/01/16.
(Barney, 1991). VRIN Framework. Available:

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Appendices:
Appendix 1:
(Hsu, J, 2013)
Appendix 2:
(Ford, R, 2015 A)

Appendix 3:
(Childe, H, 2013)
Appendix 4:
Pret A Manger has introduced a ‘pick me up’ Following on from their ‘pick me up’ ranger,
range that are juices which are bottled in Pret have tapped into it further by introducing
easier to carry and easier to pick up, smaller miniature Protein Pots which can be brought
compact bottles (Childe, H, 2015 A). as a part of one of their meals or just a small
snack (Childe, H, 2015 A).
Due to coconut water having gained recent Following Pret’s introduction of coconut
attention as a fashionable, ready-to-drink water, they launched a dairy-free coconut
product that has health benefit (with clean yoghurt (Childe, H, 2015 A).
eating/drinking becoming a recent buzzword),
Pret have now introduced coconut water in its
new five-grain porridge that was launched
early 2015 (Childe, H, 2015 A).
Pret now offers almond shakes in 2 different A number of lunch operators have started to
variants which are banana and cashew and use different grains in an attempt to
cacao and date (Childe, H, 2015 A). differentiate from in-home products and Pret
has been at the forefront of this by launching a
quinoa rice pot range at the start or 2015
which included sweet potato and cauliflower
curry quinoa rice pot (Childe, H, 2015 A).
Since the breakout of Kale, Pret has started Lastly, to once again differentiate from the
stocking kale crisps and have recently added a competition and grow, Pret introduced
kale and cauliflower macaroni cheese flavour beetroot and horseradish soup to their hot
(Childe, H, 2015 B) and these are also featured food menu (Childe, H, 2015 B).
in their new hot dishes.

Appendix 5:
(Porter, E, 1985)
Appendix 6:
(Bowman, C, 1997)

Appendix 7:
(Barney, 1991)
Appendix 8:
(Zen Entrepreneurship, 2013)

Appendix 9:
Figure 11: Selected lunch foodservice brands, by number of outlets, 2011-15
April- Oct- Nov- Sept- Sept-15 % change in number of % change in number of
11 12 13 14 outlets 2011-15 outlets 2014-15
Subway 1,420 1,423 1,650 1,800 2,070 +48.5 +15.0
(est)
Greggs 1,487 1,604 1,690 1,660 1,664 +11.9 +0.2
Pret A 236 244 264 274 288 +22.0 +5.1
Manger
EAT 103 117 113 113 123 +19.4 +8.8
(est)
(Childe, H, 2015)

Pret A Manger: Strategic Decision Making

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ABSTRACT

A strategic report outlining Pret A Manger’s strategic

Business Operations -------------------------------------------------------------------------------------------------- Pg. 3

Strategic Capabilities ------------------------------------------------------------------------------------------------- Pg. 5

Macro Analysis ------------------------------------------------------------------------------- -------------------------- Pg. 6

Competitive Analysis ----------------------------------------------------------------------------------------------- Pg. 11

Strategic Planning --------------------------------------------------------------------------------------------------- Pg. 20

Business Canvas Model -------------------------------------------------------------------------------------------- Pg. 22

SAFe Analysis --------------------------------------------------------------------------------------------------------- Pg. 28

BUCKINGHAMSHIRE NEW UNIVERSITY 1

References ------------------------------------------------------------------------------------------------------------- Pg. 33

Appendices ------------------------------------------------------------------------------------------------------------ Pg. 37

BUCKINGHAMSHIRE NEW UNIVERSITY 2

BUCKINGHAMSHIRE NEW UNIVERSITY 3

BUCKINGHAMSHIRE NEW UNIVERSITY 4

Value Chain Model:

BUCKINGHAMSHIRE NEW UNIVERSITY 5

BUCKINGHAMSHIRE NEW UNIVERSITY 6

Political factors: Meaning: Supporting reference:

BUCKINGHAMSHIRE NEW UNIVERSITY 7

environmentally friendly, and

Economic factors: Meaning: Supporting reference:

Social factors: Meaning: Supporting reference:

BUCKINGHAMSHIRE NEW UNIVERSITY 8

increase in the health

Technological factors: Meaning: Supporting reference:

BUCKINGHAMSHIRE NEW UNIVERSITY 9

brought success throughout

Legal factors: Meaning: Supporting reference:

Environmental factors: Meaning: Supporting reference:

BUCKINGHAMSHIRE NEW UNIVERSITY 10

40% the world’s population affected with restrictions on

BUCKINGHAMSHIRE NEW UNIVERSITY 11

BUCKINGHAMSHIRE NEW UNIVERSITY 12

Threat of new entrants Meaning: Impact/Urgency:

Bargaining power of buyers: Meaning: Impact/urgency:

BUCKINGHAMSHIRE NEW UNIVERSITY 13

with the fact that there are

Threat of substitute products: Meaning: Impact/urgency:

Bargaining power of suppliers: Meaning: Impact/urgency:

BUCKINGHAMSHIRE NEW UNIVERSITY 14

them for the raw materials.

Competitive rivalry: Meaning: Supporting reference:

BUCKINGHAMSHIRE NEW UNIVERSITY 15

BUCKINGHAMSHIRE NEW UNIVERSITY 16

Interpretation and analysis of the environmental matrix:

BUCKINGHAMSHIRE NEW UNIVERSITY 17

Pret A Manger SWOT Analysis:

BUCKINGHAMSHIRE NEW UNIVERSITY 18

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 ToSP2 (Low switching costs for

BUCKINGHAMSHIRE NEW UNIVERSITY 20

BUCKINGHAMSHIRE NEW UNIVERSITY 21

BUCKINGHAMSHIRE NEW UNIVERSITY 22

Business Canvas Model:

BUCKINGHAMSHIRE NEW UNIVERSITY 24

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Pret A Manger Strategy Two:

BUCKINGHAMSHIRE NEW UNIVERSITY 27

as incorporate calorie counting technology so the consumers can really

BUCKINGHAMSHIRE NEW UNIVERSITY 28

BUCKINGHAMSHIRE NEW UNIVERSITY 29