Choose a local fast-food restaurant (such as a McDonald's, Wendy's, Taco Bell, KFC, or a locally owned diner) and develop a SWOT analysis for the restaurant, utilizing the four elements of a SWOT analysis.

Question

What will be an ideal response?

Answer 1

SWOT analysis—also known as a situational analysis—is a search for the strengths, weaknesses, opportunities, and threats affecting the organization.

Examples of a firm's strengths and weaknesses: work processes, organization, culture, staff, product quality, production capacity, image, financial resources and requirements, service levels, and other internal matters.

Examples of a firm's opportunities and threats: market segment analysis, industry and competition analysis, impact of technology on organization, product analysis, governmental impacts, and other external matters (see Figure 6.2).

A SWOT analysis for McDonald's:

Strengths: McDonald's has major brand recognition, as well as a presence throughout the United States (and, increasingly, throughout the world), with reasonable prices that most people can afford, and convenient locations.

Weaknesses: Despite attempts to offer healthier foods, most meals are still high in calories and fat; jobs are perceived as "dead-end" jobs, which will not attract potential employees of high caliber.

Opportunities: In an increasingly harried world, more and more people want food delivered to their homes or offices. McDonald's might begin offering delivery in highly populated areas that would make the investment in drivers worthwhile.

Threats: Newer restaurant chains, such as Subway, emphasize the freshness and nutritional value of their menu items; restaurants have a hard time competing in large cities like New York, where people prefer local restaurants and delicatessens.