In 2003, the industry had registered total sales of over $6 billion (Ferguson, 2004). The top five competitors of Sweettreats would be: Starbucks, Nestle, McDonald's, Dunkin and Gloria Jean's.
Gloria Jean's is among the leaders of the industry and they basically address their products to the young population. The corporation is based in Australia but present in numerous countries of the globe through franchise contracts (Official Website of Gloria Jean's, 2008).
Dunkin Donuts is a U.S. based company, namely headquartered in Quincy, Massachusetts. In 2006, they registered annual revenue of over $4 billion. They address all types of consumers and sell a wide palette of coffee-based beverages and foods (Official Website of Dunkin Donuts, 2008).
Starbucks is the undisputed leader of the industry and in 2006 they registered annual revenues of nearly $8 billion (Official Website of Starbucks, 2008). They are headquartered in Washington and they operate all across the world. Most of their success is based on the brand-oriented marketing strategy.
Nestle is based in Switzerland but like most of Sweettreats' competitors, operates at international scale. The company sells a wide series of products, coffee being just one of them. Most of Nestle's products are designed for home consumption.
However McDonald's has developed their operations in the fast food industry, the latest tendency with their business strategy is to expand and cover new areas. One of these areas is that of selling coffee and by this they managed to address a new target market: the parents. Their needs were basically overlooked by McDonald's who only saw them as the parents of their main consumers.
2.4 Product Offering
Sweettreats will offer a wide variety of products, fit for all children, parents, single individuals and couples going to the evening bar. However the product offering could easily become even more diversified to fit the particular needs and requirements of their customers, the basic offering will consist from:
Coffee-based beverages
Sandwiches, panini wide variety of ice-cream, heavily decorated with sweet treats and fruits for kids
Pastry, chef master piece cakes, scones, etc. from all over the world, not just U.S. specific
Giant super-thin pancakes loaded with warm supreme chocolate, fruits, cream, etc.
During night-time, the shop will also sell alcohol-based cocktails with reduced concentrations and in limited quantities
The coffee shop will not sell tobacco products nor will it allow smoking.
2.5 Keys to Success
Swettreats's keys to success reside in its capability to differentiate itself from its competitors. In this order of ideas, a major aspect is given by the dual functionality of the coffee shop. Most competing stores only function as coffee stores during day time and close during the night. In addition, must bars are closed during the day and only function during the night. But Sweettreats has managed to efficiently utilize the same space so to retrieve revenues literally day and night. And this means that customers will be able to go to Sweettreats when ever they feel like it, without any time restrictions.
Another feature that will ensure the success of the new coffee & bar is given by the fact that it offers playground for the children. This resolves the problems of parents who want to meet their friends for coffee but do not want to leave their kids with a babysitter.
A third feature which differentiates Sweettreats from its competitors is given by the pleasant ambiance within the coffee shop. Aside other stores which simply sell the coffee for customers to drink on the street, Sweettreats offers a pleasant space where clients can relax and enjoy their order.
Other issues which increase Sweettreats' chances of success regard the wide array of products sold, including a wide variety of beverages and foods. Then, in comparison to Nestle or McDonald's, which commercialize multiple items, Sweettreats is based on offering only two major categories of products. This will make them better specialized. Starbucks and Gloria Jean's are then renowned for their high prices, but Sweettreats will offer similar quality products, but at significantly lower prices.
2.6 Critical Issues
Sweettreats will have to face up to the challenges posed by the industry and the market in regard to several critical issues. As such, the company officials will have to think of a way to perfectly harmonize the daily coffee shop with the night bar, without one affecting the other. For instance, they will have to be attentive for children not come in contact with the alcoholic cocktails served the night before. Then, they will have to hire skilled and capable personnel to attend to the clients and be willing to also work night shifts. The staff must be properly remunerated and motivated through a series of financial and non-financial...
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