External and Internal Environmental Analysis
External and Internal Environmental Analysis
Charles Johnson
STR 581
January 9, 2013
Professor Virginia Green
External and Internal Environmental Analysis Theez Doggs is a start-up restaurant in the City of Inglewood, CA. The restaurant industry is very competitive industry. A wide variety of foodservice businesses exist to generate profits from the sale of their products and services to travelers and area residents. Thousands operate in the Los Angeles area. In this paper, I will identify and analyze the most important external environmental factors in the remote, industry, and external operating environments. I will also identify and analyze the most important strengths and weaknesses of the restaurant and include an assessment of the organization’s resources. In addition, I will assess the restaurant’s competitive position and possibilities.
External Environment The external environment consists of the three subcategories: remote, industry, and operating environments. The remote environment comprises factors that affect the firm’s operations such as economic, social, political, technological, and ecological. Theez Doggs operate in the competitive restaurant industry.
Remote Environment The most important economic factors in the restaurant industry that affect Theeze Doggs are inflation rates, unemployment rates, interest rates, and availability of credit and investors. The cost of food has to be managed carefully to keep prices down. The unemployment rate will have an impact on the company. There is a large pool of labor. Interest rates are at an all-time low. This will have a positive effect on the cost of capital. The availability of credit is challenging. Banks and other lenders are reluctant to lend at this time. The company will seek investors for financing. Social factors that will affect the company the most include a shift in the age distribution of the population and constraints of fixed incomes of many seniors that
Charles Johnson
STR 581
January 9, 2013
Professor Virginia Green
External and Internal Environmental Analysis Theez Doggs is a start-up restaurant in the City of Inglewood, CA. The restaurant industry is very competitive industry. A wide variety of foodservice businesses exist to generate profits from the sale of their products and services to travelers and area residents. Thousands operate in the Los Angeles area. In this paper, I will identify and analyze the most important external environmental factors in the remote, industry, and external operating environments. I will also identify and analyze the most important strengths and weaknesses of the restaurant and include an assessment of the organization’s resources. In addition, I will assess the restaurant’s competitive position and possibilities.
External Environment The external environment consists of the three subcategories: remote, industry, and operating environments. The remote environment comprises factors that affect the firm’s operations such as economic, social, political, technological, and ecological. Theez Doggs operate in the competitive restaurant industry.
Remote Environment The most important economic factors in the restaurant industry that affect Theeze Doggs are inflation rates, unemployment rates, interest rates, and availability of credit and investors. The cost of food has to be managed carefully to keep prices down. The unemployment rate will have an impact on the company. There is a large pool of labor. Interest rates are at an all-time low. This will have a positive effect on the cost of capital. The availability of credit is challenging. Banks and other lenders are reluctant to lend at this time. The company will seek investors for financing. Social factors that will affect the company the most include a shift in the age distribution of the population and constraints of fixed incomes of many seniors that
References: Ninemeier, J., Hayes, D (2006). Restaurant Operations Management Principles and Practices Pearson Prentice Hall, Upper Saddle River, New Jersey. Pearce, J., and Robinson, R. (2011). Strategic Management Formulation, Implementation, and Control, 12th ed., McGraw-Hill Irwin, New York, NY.