Detailed international business analysis
The business structure of Levendary Cafe is relatively straightforward. There are four elements of the cost structure of a multi-unit restaurant chain that are- occupancy, labor, food, and supply. The occupancy costs are related to real estate rental, maintenance, and energy and waste management. Occupancy covers around 10% of the revenue. Laborers are considered to be the most significant cost element. 25% to 30% of the revenue goes to labor management. Food cost represents not only the ingredients but also the food wastes. In this regard, food costs around 25% to 35% of the total revenue. The supply chain typically costs around 1% to 4% of the total revenue. Supply cost covers the paper products, plates, tables, chairs even the costly uniforms in the higher-end restaurants (Bartlett and Han, 2011). In the US market, Levendary Cafe was famous because of its favorite and high-quality dishes and high level of hospitality to the customers. Another crucial factor of Levendary Cafe was its willingness to take risks, which is characteristic of its founder Howard Leventhal. As an example, the cafe decided to use only grains in order to produce the grass and hormone-free natural meats in the sandwiches. The customers remarkably accepted these changes even in the tradeoff regarding the price hikes. This describes the customer trust in the cafe. The fundamental concepts of the CCO, Lucian Leclerc’s strategies, held the company to the top (BCG, 2010). The marketing group p was interconnected with the CCO, and they were responsible for advertising the products to the market. They ensured to maintain the popularity of every 3,500 stores across the country. The fully scaled kitchens of each of the stores of Levendary Cafe were equipped with a science lab in order to provide the best food standards to the customers. The COO, Nick White, ensured the synergy amongst all of the 1200 business managers in order to maintain the optimum amount of operational effectiveness. Two-thirds of the stores were franchised, which were supported by chief franchise officer Peter Steele. In 2010, before expanding in the Chinese market, Levendary Cafe sold almost $10.7 million worth of products, including royalties sales. After every deduction and payment, it has been found that they made a total profit of $780k in that year by staying in only one country. Thus, due to this success in the US market, the business development group was trying to spot new opportunities in the global market.
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