Levendary Café the China Challenge - 1769 Words

Mahra Al-Qahtani 2013 Question 1: What is your evaluation of the way Levendary Cafe has entered the China market? The entrance of china was more opportunistic expansion rather than strategic. The huge population of 1.4 billion people and annual GDP growth of 14.5% over the past decade, China’s urban population rise from 36.2% of the total in 2000 to 46.6% in 2009, and the strong middle class whose per capital income surged from RMB 6,282 to RMB 17,175 (In 2010, RMB 1 = USD 0.15.) all made china as great opportunity for the restaurant that was facing a mature market that had a growth of merely 1%. Another attractive factor of china market was the success of many American restaurants such as KFC, McDonald’s and Pizza Hut’s. However†¦show more content†¦Levendary cafà © in china should not be completely different from that of US yet the flexibility is a must to survive in China. Foster should cooperate with Chen to find the proper way to adopt the Chinese culture and style in term of the menu choices yet they have to capitalize on what they are good in and use it as a competitive advantage such as the personalized services and the fresh organic food. They need to be differentiated to be considered by the Chinese customers. The stores should be located according to a strategic plan rather than opportunistic ones. Urban arias are the best choice for Levendary. Finally, a plane for the operation should be put and controlled. Regarding the relationship with Chen, a meeting with Chen, Foster and the concept team must be held. Foster who is a good communicator should make everything clear to Chen and let him know to which extent his changes are acceptable and to emphasize on the identity of Levendary and the image that they want consumers to have. Another important issue is that Chen has to conform to the companys planning and reporting processes and work in light of the corporate strategy. Foster should discard the option of firing him since he has many qualities like the Chinese language, the connections in China and also he is willing and eager to make this work and also, it is hard to find a replacement. Since she is known for her frank