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Appendix A

Competitive and growth strategies of Wendy`s in international markets

The work “Wendy's Generic Strategy & Intensive Growth Strategies” by Andrew Thompson (2017) is based on academic sources and companies` reports and is directed to reveal the core competitive and growth strategies used by Wendy`s company worldwide and show how the company implements these strategies.

According to the author, “Wendy's differentiates its business and products from competitors through product innovation that addresses market and consumer trends”. A. Thompson (2017) also explains that in terms of competitive generic strategies, the main objective for Wendy's is to build up competitive advantage, namely affordability, high quality and service leadership that allows to implement growth strategies and withstand strong competition from main rivals, keeping the market position and support global competitiveness. The objective of the intensive growth strategy is to increase the market share internationally, entering new countries and regions and expand deep into these markets. Wendy's concentrates on the broad market and implements cost leadership and broad differentiation generic strategies. According to A. Thompson, in 1988 Wendy's was the pioneer fast food chain that introduced a single price point for a menu at 0,99$ for every item. Since that time, the company continues to reduce costs to set low prices to successfully compete against rivals. Differentiation strategy of Wendy's implies the product uniqueness. A. Thompson indicates that “Wendy's promotes its square-shaped fresh ground beef patties that are significantly bigger than those of McDonald's and other fast food hamburger chains”. Moreover, according to A. Thompson, “Wendy's array of salad menu items also sets the company apart from competitors in terms of health concerns”. Such differentiation makes the company's concept distinct from others.

In terms of “The Discipline of market leaders” theory, the core discipline for Wendy`s is operational excellence by which the company standardize all the operations and minimize costs through economies of scale. The resulting cost savings lead to competitive advantage.

The growth strategies of Wendy`s reflect organic and inorganic growth. In 2008 the Wendy`s company website announced the company`s complete merger transaction with “Triarc Incorporated”, the parent company of Arby`s Restaurant Group. Roland C. Smith, President and Chief Executive Officer of Wendy's/Arby's Group, said: “As one company, we are well-positioned to deliver long-term value to our stockholders through enhanced operational efficiencies, improved product offerings, shared services and strong human capital. We have worked together diligently to close this transaction over the past several months, and will push forward with that same intensity."(as cited by Thompson, 2017). The merger turned to be very successful, as after joining efforts Wendy`s/Arby`s Group has become the third largest fast-food company in the United States.

As for organic growth of Wendy`s, it includes market penetration, market development and product development strategies. Market penetration is the core intensive growth strategy of the company, through which Wendy`s establishes new restaurants on existing markets to increase sales. Such generic strategy as cost leadership allows the company to set affordable prices and expand quickly, attracting new customers to just opened restaurants. In the article by Andrew Thompson, it is indicated: “The strategic objective linked to the market penetration intensive strategy is to grow Wendy's through low-cost expansion alongside economies of scale”. It works efficiently especially in markets where customers are highly price sensitive.

The secondary growth strategy of Wendy`s is market development, that implies entering new markets through franchising agreements, however, the company`s rate of entry to new markets is quite low in comparison with main rivals. Finally, the product development strategy is conducted with minimum emphasis as a supporting strategy. Since 1979 when the salad bar was introduced, the differentiation generic strategy supports this intensive growth strategy by emphasizing product innovation that is primarily reflected in superior quality rather than constant launching of new items.

Appendix B

Specifics of competitive and growth strategies implemented by Burger King in India

The Supply chain digital website provides the article «How Burger King India aims to boost its share in the QSR market» by Laura Mullan (2018). The article gives a clear picture of how Burger King operates in India in terms of competitive and growth strategies.

According to the article, Sandeep Day, Chief supply chain officer claims that Burger King`s objective in India is to provide the market with burgers of superior quality offered at the most affordable prices. Great emphasis in the article is made on Burger King`s optimization of costs reached through economies of scale, establishing of local supply chain and driving down transportation costs by flexible contracts. These factors mean that Burger King in India implements cost leadership generic strategy. Differentiation generic strategy as supporting strategy is implemented in India in the same way as in other regions, primarily through grill made whoppers and providing non-limit access to beverages. That two main peculiarities differ the company from the rivals making that features a unique selling point in conditions of intense rivalry. The author of the article also stresses out such a significant element of Burger King in India as a lean team. It is vital to stress out that “by outsourcing everyday non-value-adding work to specialized logistic companies, Dey and his team focus on what matters - meaningful, value-adding, strategic work that truly makes a difference to both customers and employees alike” (Supply chain digital, 2018). Moreover, Burger King in India hires local staff, selecting most talented managers and educated, enthusiastic workers, provides constant training for them and introduces the system of rewards. As the fast food market of India is one of the largest markets and expected to be worth US$ 27.57 billion by 2020 (PR Newswire, 2015), there are many people employed and searching for a job in the fast food sector, that makes labor supply high in this segment.

All the measures above used by Burger King in India describes successful implementation of two disciplines, namely operational excellence as a primary discipline, conducted through cost reduction, optimization of business processes and smooth standardized production, and product leadership as secondary, conducted through effective marketing and creation of lean enthusiastic team, constantly trained and motivated to serve customers at the highest level with superior quality products.

In terms of growth strategies, Burger King in India is considered as one of the most rapidly growing fast food chains. The core principle of the Burger King`s growth in India is organic growth through deep extension. The Chief Supply Chain officer explains: “Our overall business philosophy has always been to grow deeper rather than grow wider; to strengthen our existing markets that helps us to leverage the supply chain cost and make it much more efficient. When we open a new store in a new city, the initial distribution cost is slightly higher, because we are not utilizing the full potential of the warehouses and delivery trucks, for example. However, when we open five or six stores in that region, the overall distribution cost will go down significantly and the stores will start becoming much more profitable. Therefore, scalability is driving profitability and vice versa.”(Supply chain digital, 2018).

Thus, in terms of the Ansoff Matrix, Burger King implements the market penetration organic growth strategy in India through active promotion and affordable prices as well as product development organic growth strategy by periodical introduction of new products. It is also indicated in the article that the primary tool of the growth strategy for Burger King is the franchising program that due to healthy business culture offered more opportunities in Indian fast food market rather than challenges. Moreover, according to Burger King`s Chief Supply Chain officer deep market penetration contributes to the process of cost cutting operations.

Appendix C

Figure 7. Growth strategies used by international fast food companies

Compiled by the author based on the conducted research.

Figure 8. Competitive strategies used by international fast food companies

Compiled by the author based on the conducted research

Table 4

Compiled by the author based on “Strategic responses to competition among large fast food restaurants in Nairobi central business district” by Mwangi, C. W. (2010) and “Porter's Generic Competitive Strategies” by Tanwar, R. (2013).

Table 5

Compiled by the author based on the research conducted and “The discipline of market leaders: choose your customers, narrow your focus, dominate your market” by M. Treacy and F. Wiersema (1995).

Table 6

Compiled by the author based on the research conducted and еру куыуфкср “Strategies for Diversification” by H. I. Ansoff (1957).

Appendix D

Specific features of growth and competitive strategies of international fast food companies in India

Figure 9. Compiled by the author based on the conducted research

Figure 10

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