Chick fil a swot analysis

SWOT Analysis

Chelsea McCray

Marisol Scheer

MGT 3340

November 2, 2019

Running Head: SWOT ANALYSIS 1

SWOT ANALYSIS 5

SWOT Analysis

Chick-Fil-A was founded in 1946 with its headquarters in College Park, Georgia, United States. It is a fast-food chain famous for its chicken sandwiches. The chain main ingredient is chicken for breakfast, lunch, and dinner. It operates under various concepts like a drive-thru only, mall or in-line, and Dwarf House and Truett’s Frill (Chick-fil-A, n.d.). It operates licensed, satellite lunch counters and non-traditional outlets. The chain offers a wide range of burgers, desserts, drinks, sandwiches, wraps, side dishes, and wraps. It also provides catering services to private and public events and it owns merchandises like sweatshirts, accessories, and T-shirts.

In just the United States, the company is one of the top-players in the segment of fast-food outlets providing chicken with KFC as their major competitor. It announced $4.4 million in their annual sales in the United States only (Bhasin, 2019). Compared to other major players in the segment like KFC, Chick-fil-A has 2100 outlets which are relatively small. However, its revenue has made it comparable to top player making it a market leader. The outlet does not operate on Sundays and holidays

SWOT Analysis of Chick-fil-A

This analysis examines the strengths, weaknesses, opportunities, and threats of Chick-fil-A. SWOT analysis is a management tool that helps brands like Chick-fil-A benchmark their performance compared to their competitors in the industry (Sarsby, 2016).

The Strengths at Chick-fil-A

The strengths of a business are the business practices that make it unique from its competitors. The strengths of Chick-fil-A include the chain has impeccable customer service (Bhasin, 2019). This is unusual in fast food because most use the self-service model. Their customer service makes them different from their competitors. The chicken sandwiches at the outlet differentiate it from the competitors in the industry. In the United States, most burgers are beef burger, but this chain sells chicken sandwiches which are burgers filled with chicken and patties (Chick-fil-A, n.d.). The conversations on the dangers of eating red meat have helped the outlet. Majority of fast-food outlets are not inviting for customers to spend a lot of time. Therefore, they have simple and formal décor. This is not the case with Chick-fil-A. The outlet has made an inviting ambiance with the use of employee’s pictures and writings on the walls, and warm colors.

The employees at Chick-fil-A are paid higher than the average industrial rate. Also, they provide their employees with opportunities for career development and advancement (Bhasin, 2019). This has helped ensure employee satisfaction and reduced employee turnover. This creates an impression of being wanted in the restaurant to the customers. The chain has seen continuous growth in its revenue over its years of operation. It also uses a strong advertisement; “Eat Mor Chikin” a slogan that uses cows (Chick-fil-A, n.d.). The purpose of the cow is to discourage the consumption of beef burgers provided by competitors. The chain has been sponsoring sport events and taking part in charity events. Also, their online presence enables customers to make online orders and delivery.

The Weaknesses at Chick-fil-A

Weaknesses refer to the areas where a business needs improvement. Some weakness of Chick-fil-A includes the prices are higher compared to their competition. Even though the quality of service and food is worth the price, the low and middle income earners in the U.S. are not familiar with the brand (Bhasin, 2019). Unlike their competitor KFC that has outlets in other countries, Chick-fil-A operates only in the United States. This has limited their popularity leaving it out of the big league in this industry. Innovation and technology have become part of fast food companies. These companies are reinventing their marketing, supply chain and menu. Innovation is an easy task for big brands whose profitability depends on sales volumes. However, this has not been the case with Chick-fil-A which is not a global brand. The growth rate of the industry is faster than it can handle with the entry of new fast-food outlets. This leaves customers with a lot of choices. This affects customer loyalty and expensive brands like Chick-fil-A face the challenge of keeping their customers (Bhasin, 2019). The outlet suffers from reputational loss because of its same-sex marriage controversy comment by its chief operating officer in 2012. This led activists to call for a boycott and protests. It limits their customers’ options by offering only chicken fast food.

The Opportunities Chick-fil-A face

Opportunities are the external environment surrounding a business in which it can capitalize and increase their revenue. The opportunities at Chick-fil-A include fast-food joints offer poor customer services which have shifted the preference of customers to fast-food outlets like Chick-fil-A that value quality customer service (Bhasin, 2019). Thus, it should capitalize on this opportunity. With the ongoing advocacy against consumption of red meat, companies need to reinvent and focus on healthy options. Chick-fil-A can increase its customer base because they provide white meat food and also diversifying their healthy food option. Another opportunity is expansion to other countries. Their competition KFC is doing well in other countries. They should also focus on penetrating the untapped areas in the United States. Chick-fil-A should capitalize on this area. Their menu limits the customers’ options. Reinventing and expanding their menu will help the outlet increase their customer base.

The Threats Chick-fil-A face

Threats are environmental factors that make it hard for the growth of a business. Some threats that Chick-fil-A faces include stiff competition from competitors like KFC and Popeye’s. KFC has ventured into other countries making it a global brand. Therefore, the company is making more sales compared to Chick-fil-A (Bhasin, 2019). It is also well-known by consumers. The competitors’ menus also provide a variety of options for customers. This makes them a better option because it does not limit customers to certain food. There are a lot of scandals around chicken-based food outlets like KFC. The scandals relate to chicken quality and quantity used. This creates apprehension in customers and many of them avoid these outlets (Bhasin, 2019). Also, there has been an issue of chicken shortage in the United States which threatens the performance of the outlet as the price of raw chicken rising with the scarcity.

Conclusion

To sum up, Chick-fil-A has maintained its reputation and operation in the United States for decades. Its chicken sandwiches have kept them in competition in the fast growing industry. The outlet has strengths that make help stay competitive in the industry, but it faces threats and weaknesses that hinder their growth. However, there are some opportunities that the outlet can venture in for further growth.

References

Bhasin, H. (2019, Apr 2). “SWOT analysis of Chick-fil-A.” Marketing91. Retrieved from: https://www.marketing91.com/swot-analysis-chick-fil/

Chick-fil-A. (n.d).Chick-fil-A: Home of the Original Chicken Sandwich. Retrieved from: https://www.chick-fil-a.com

Sarsby, A. (2016). SWOT analysis. Lulu. com.