Essay About Competitive Market And Digital Java Coffee Market

Strategy Planning
Strategy Planning
SWOT Matrix
STRENGTHS-S
KKD one-of-a-kind taste
Total Revenue grew in 2003 by 30% from 2002
Marginal increase in Operating Expenses from 2002 to 2003
Total Revenue grew in 2004 by 50% from 2002
Profit rose by 50% in 2004 from 2002
338 stores operating in 41 states
KKD offers doughnuts at a discounted price for community events
Enticing doughnut making “theaters”
KKD store production capacity from 4000 dozen to more than 10,000
Diversified into Coffee roasting and brewing
WEAKNESSES-W
KKD has very few stores compared to the competition
Very little or no international presence.
High calorie food
Assets dropped in 2004 from 2003
Total liabilities rose in 2004 from 2003
Legal and ethical problems in the Sr. Management
No name brand recognition for Digital Java coffee market.
OPPORTUNITIES-0
International market is not being served
Raising demand for low calorie, healthy diet food options.
Families spending more money eating out.
Loyal customer base
KKD’s web site is not as user friendly as that of competition.
Less number of stores domestically compared to competition.
Not much known in Coffee roasting and brewing market segment
SO STRATEGIES
Reach out to loyal customer base and increase choices (S1, O4)
Expand e-commerce division (S3, O5)
Expand domestically. Find strategic locations (S6, O6)
Think forward integration; with Walmart, Target etc. (S8, O3)
Promote coffee brewing market (S10, O7)
WO STRATEGIES
Introduce healthy “low-calorie” doughnuts with the same taste (W1, O2)
Partner with international chain (W2, O1)
Enhance the Coffee market segment (W7, O7)
THREATS-T
Fast food institutions are major contributors to obesity.
Recovering from bankruptcy.
Loosing customer base to dine in restaurants.
ST STRATEGIES
Advertise variety, brand recognition, and community awareness (S7, S8, T1, T3)
WT STRATEGIES
Expand international presence through partnership
Diversification (W3, T3)
SPACE Matrix
INTERNAL STRATEGIC POSITION
EXTERNAL STRATEGIC POSITION
Financial Strength (FS)
Score
Environmental Stability (ES)
Score
Total Revenue grew in 2003 by 30% from 2002
KKD e-commerce segment
Marginal increase in Operating Expenses from 2002 to 2003
Coffee roasting and brewing market
Total Revenue grew in 2004 by 50% from 2002
Highly competitive market (KKD, DD, Starbucks)
Profit rose by 50% in 2004 from 2002
Corporate ethics
Sales grew 11% in 2004 Vs DD 6%
Share price quadrupled to more than $40 between 2000 and 2004.
Average
Average
Competitive Advantage (CA)
Score
Industry Strength (IS)
Score
13.1% of U.S doughnut market, up from 4.8 in 1999
Potential domestic market expansion, West and South West
Excellent name brand recognition and customer loyalty
Big profit potential