Levendary Cafe
Levendary Café Homework Assignment 2
Question 1: What is your evaluation of the way Levendary Café has entered the Chinese market?
I think Levendary Café entered the Chinese market in a decent way. The pros of how Levendary Café entered the Chinese market included the amount of opportunity in China, the success of other foreign restaurant chains and the experience of Louis Chen. The China GDP growth of 14.5% over the last decade made it “ripe for investment”. China’s urban population growth and emerging middle class provided great opportunity for great developments and progress across all markets. The lifestyle trend to go out to eat was growing which supported expansion in the food services industry. Foreign fast food companies attracted the most attention in the Chinese food services industry, which indicated a prime time for Levendary to enter into the market. The standardization of products demonstrated by these foreign restaurant chains prompted Chinese chains to embrace these operational tools.
The main pro of how Levendary entered into the Chinese market was by utilizing the skills of Louis Chen. Chen was a very high-energy and motivated entrepreneur. Chen was bilingual in English and Mandarin Chinese and was very familiar with neighborhoods in Shanghai, China through his decade of experience as a retail property developer. Chen also brought with him a network of contacts to help speed up processes such as permitting, incorporating and staffing stores.
The first con of how Levendary entered into the Chinese market would be the slow moving away from the standardization that it was used to. Being the same across the board while having a few minor changes based off of geographic location is one thing, but to have almost the entire menu changed was a huge flaw. The second con of how Levendary entered would be that an executive did not travel to China prior to the opening of many chains. Entrusting this with Louis Chen wasn’t necessarily a bad thing, but
Question 1: What is your evaluation of the way Levendary Café has entered the Chinese market?
I think Levendary Café entered the Chinese market in a decent way. The pros of how Levendary Café entered the Chinese market included the amount of opportunity in China, the success of other foreign restaurant chains and the experience of Louis Chen. The China GDP growth of 14.5% over the last decade made it “ripe for investment”. China’s urban population growth and emerging middle class provided great opportunity for great developments and progress across all markets. The lifestyle trend to go out to eat was growing which supported expansion in the food services industry. Foreign fast food companies attracted the most attention in the Chinese food services industry, which indicated a prime time for Levendary to enter into the market. The standardization of products demonstrated by these foreign restaurant chains prompted Chinese chains to embrace these operational tools.
The main pro of how Levendary entered into the Chinese market was by utilizing the skills of Louis Chen. Chen was a very high-energy and motivated entrepreneur. Chen was bilingual in English and Mandarin Chinese and was very familiar with neighborhoods in Shanghai, China through his decade of experience as a retail property developer. Chen also brought with him a network of contacts to help speed up processes such as permitting, incorporating and staffing stores.
The first con of how Levendary entered into the Chinese market would be the slow moving away from the standardization that it was used to. Being the same across the board while having a few minor changes based off of geographic location is one thing, but to have almost the entire menu changed was a huge flaw. The second con of how Levendary entered would be that an executive did not travel to China prior to the opening of many chains. Entrusting this with Louis Chen wasn’t necessarily a bad thing, but
Cited: Bartlett, Christopher A., and Arar Han. 2013. “Levendary Café: The China Challenge”. Briefcases: Harvard Business School, 1-10.