Operationalizing New Service Concept in Pre-Existing Fast Food Chain Essay

Operationalizing New Service Concept in Pre-Existing Fast Food Chain of Restaurants - Essay Example Introduction 4 2. Background 5 3. Literature Review 5 4. Designing New Service Concept and Service Innovation 6 5. Research 6 6. Service Recovery Design 7 7. Recommendations 8 8. Service Strategy 10 9. Conclusion 10 10. References 12 1. Introduction Customers are significant for every business , however, for fast food companies , which offer food which are perishable, it is very important to retain customer, create customer loyalty and regulate customers to survive in the increasingly competitive environment, which has been elevated through the globalization of fast food chains. Brink and Berndt (2004) found that many companies spent a lot of their efforts, money and time to recruit new customers but a few companies took appropriate steps to retain customer and customer loyally. In 2011, the total revenue generated by Italian fast food market was $2.1 billion, which represents a negative annual rate from 2007 to 2011. The demand for fast food was high till 2007 and the market perform ance also reduced during this time period. The market volume in fast food is classed as the number of visits the customer makes to the same fast food restaurant. Fast food restaurant market can be broken down into- Take Away Quick Service restaurant Mobile Food Street The fast food restaurant at the leisure locations The fast food chains meet new competitors in the market and customer relationship is the marketing purpose which can keep customers from going to the competitors (Ramakrishnan, 2006). Customer retention is the method which helps to keep customers actively involved with the firm through optimal allocation of resources (Kotelnikov, 2006). Six economic benefits of customer retention as outlined by Brink and Berndt (2004)- It reduces the cost of customer acquisition and customer replacement. It guarantees base profits as the customers may follow the minimum spend for a time period. It promotes increased customer revenue. It reduces the overall operating costs as the compani es spread the costs over many customers. It provides easy referral to new customers from the pre-existing customers and the customer can be charged premium price as they do not wait for discounts or price reductions. 2. Background The Italian restaurant operates a chain of 26 full-service restaurants close to shopping malls and high streets. The restaurant is known for excellent service and high quality Italian cuisine. The restaurant is looking for expansion opportunities and the management wants to launch new chain which will have following features 1. Low cost food 2. Limited menu The main issue is that the new outlets may lead to poor customer experience which can tarnish the image of the well established restaurant brand. Regardless of what the service industry perceive about their service and customers, the service should function for customers properly. It should be as per the perceived notion of service by the customer, even if in case, the customers have not experienced it previously (Johnston and Clark, 2001). Through word-of-mouth customer have a perceived imagination of the type of service, and during and after the service delivery the service should meet customers’ expectations related to the duration, notion and flexibility provided. Every organisation should focus on delivering the service concept. The paper explains how service concept is the key driver in service design decision at various

Supply Chain Management Essay Example | Topics and Well Written Essays - 2000 words - 1

Supply Chain Management - Essay Example A Brief History of Nissan: The process of business within the 21st century has developed to a remarkable extent(Davies, 2004). Facing fundamental issues with cost and levels of continued business growth, Nissan’s European division chose to integrate with its supply chain as a means of evoking positive change. Nissan therefore reviewed the issues that their supply chain engendered and sought to evoke a further level of efficiency from it. Supplier Initiative/Management Initiative: 1: Referenced Definition of Supplier Development Some of the points that can be taken away from this particular case are with regards to definitions of supplier development, the different foundations which need to be put in place as a means of improving the initiatives that were engaged, a clear delineation of the objectives of the customer and supplier may seek to achieve from such improvement initiatives, the role of leadership within Nissan and how this impacted upon the supply-chain management tha t took place, the way in which commonality of purpose was achieved between the suppliers and Nissan, the performance measurements that were used as metrics, a close discussion of supply improvements that were engaged, the risks and benefits of engaging in such an initiative, mistakes that can be learned from, and future trends that are likely to be evidenced within other branches of Nissan; as well as throughout the industrial world. 2: The foundations which need to be in place to enable the improvement initiatives between customer and supplier contained in the case to take place Firstly, it must be understood that with regards to supplier development, Nissan fundamentally engaged in a redefinition of the way in which this process was previously affected. Through an internal investigation with regards to efficiency and the means through which product was provided, Nissan came to the clear understanding that if further profitability and viability of the brand was to be effected, a fu ndamental shift with regards the way in which products were supplied must be effected. As such, a reintegration with the definition and approach to supplier development was necessitated and affected. Supply Chain Management: As a function of the difficulties that have thus far been defined, Nissan Motor Company found it necessary to engage directly with the suppliers and enter into a new form of cooperation and communication that they term as COGENT. Within this particular approach, Nissan sought a level of oversight with respect to the design process and final production of the components that would eventually make their way into Nissan automobiles within Europe (Ludwig, 2010). Instead, COGENT was engaged as a means of overseeing and reviewing the supplier process. Nissan co-development initiative (COGENT) Realizing that the major drawbacks of the other approaches that they could take would place little incentive or integration within the actual supply mechanisms of Nissan, the Co- development init