Essay: The Fast Food industry in Australia

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  • Subject area(s): Business essays
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  • Published on: February 10, 2016
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  • The Fast Food industry in Australia
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1.0 Introduction
This business report has been developed based on the interest that the assignment dictates on the choice of industry. Thus, the industry of choice is the fast food industry in Australia, with the firm choice being the Subway Restaurant. Thus, the report is maintained along the brief descriptions of the industry comprising the first part of this report. Equally, based on the position that the porters five forces of competitiveness this report is interested in the development of an analysis for the competitive strategy that the fast food industry has in the Australian divide.
With the suggestions of the competition aspect that the restaurants will be having, this report chooses to focus on the direction that the competitive strategies of Subway in the current time and financial year has managed to remain competitive based on internal and external factors.
2.0 Industry and firm description
According to the Prime Skills (2014) the Australian fast food industry is entirely concentrated with standardization. This implies that restaurants have been very particular of the maintenance that the customer base that the restaurants will be having. With the end of the financial year 2014, the concentration of the fast food industry has been identified as the major point from which the restaurants compete (Marketing 91 2015). Thus identifying with the overall performance of the industry in terms of the consumer and revenue growth the restaurants cumulatively have increased to $ 34.8 billion in the year 2014 (Prime Skills 2014).
This implies that the fast food industry in Australia is one that is packed with the interest of the top chain restaurants having better and larger control in the market. Looking at the position that the revenues base has, the suggestions of Dawkins & Reichheld (2011, p. 43) is a major concern of the position that this base has in the competitive position that the restaurants will be having. With the dimensions of leverage in competition for financial performance measures the restaurants can only be in a position to make more in terms of investment returns, profitability, and activity (Haifeng 2014, p. 14).
This comparative advantage position is asserted with the look at the Subway restaurant Australia performance in the year 2014. According to Prime Skills (2014) the Subway restaurant of Australia was among the big four retail fast food chains that used the asset base in the acquisition of the customers and revenues growths. In fact, this base competition has been the position from which the major restaurants inclusive of the subway have been accessing funding, costs and allowing the growth of the restaurants in profitability and market capitalization (Faff & Howard 2011, p. 90).
3.0 Analysis on the competitiveness of the industry
The degree of competition in the fast food industry can be described as one that has been very well regulated with the consumer preference. According to Bekaert, Hoerova & Duca (2013, p. 773) this has been tabled as the position that is the industry in Australia has in terms of the responses to the five major concern that the porter forces. These forces are the suppliers and the buyers bargaining powers, the threat that they have with substitution, new entrants and the industrial rivalry (Haifeng 2014, p. 15).
Singling these five forces out, the following is noted with the competitive direction that the fast food industry has in Australia. 
Forces Analysis
Bargaining powers of suppliers The suppliers in the fast food industry are the direct influencing partners, their bargaining power is described along the suggestion of the prices that they keep shifting within the financial years, their strategic risk management such that that they are in a position to change and influence the suppliers for food have in Australia.
Threats of substitutes The restaurant is materially in the field for competition on the top four shares that the subway has together with other restaurants like the McDonalds will be competing for the customer base in this scenario. The substitution is based on which of the top performing restaurants will be able to attract clients their way.
Bargaining powers of buyers The consumer market in Australia is particularly interesting to this analysis. According to Faff & Howard (2011, p. 87) the prices keep changing based on the demand that is attributed the market sectors. These are the preferences and the cost allocation from which the restaurants defend themselves. Such buyer’s bargaining powers in the fast food sector have been material to the segmenting of the fast food restaurants specialization. For examples the assumptions of this report are based on the fact that the Subway is more inclined to sale of hotdogs and as McDonalds is assumed to be more versed with burgers and chip fries.
New entrants This is one competitive force that the competitive environment in fast food for Australia does not find as very imperative to the operations of the business sector. This is because with the market’s capitalization that the market has, any new player will need to not only focus on brand imaging but equally they will need to be more inclined to the concerns of their capital outlay.
Industrial rivalry The industry in totality can be asserted to be one that cannot be assumed to be under any valid competition from the other allied hospitality sectors. This is majorly attributed to the fact that the other institution players in the markets cannot be viewed as very influential on the performance and the competition that the smaller brands and cuisine restaurants have their own clientele
Table 1: Porter’s analysis 
4.0 Current competitive strategy
Looking at the position that is suggested with the report Eating Out (2014), the Subway is one that is described with the suggestions of risk management as the major concern that they have in their strategic business risk positions (Eating Out 2014). With this point of need, the competitive forces at work are technology, regulatory and the social trends. Suggestions from the notes to the financial statements have been descriptive of the objectives that the company has defined in the monitoring and the initiatives that the investments dimensions of the company will be having. Identifying with the Eating Out (2014) the market competition, and the market forces are considered under the sensitivity analysis that the figures in the risk management have provided. These have been identified under the lower cost of generic strategies in creating a competitive advantage (Dawkins & Reichheld 2011, p. 44).
According to Haifeng (2014, p. 14) the low-cost strategy is very beneficial to the company, this is based on the position that the company has in having realized better margin on the real value of their products in the market. With this the advantage that they will be having will be installed in the position that the company has in lowering some of its prices or giving discounts such that their competitors of the restaurant can be able to bow out of the competition. Suggestions from the blog statement Eating Out (2014) has been material to identifying the use of the low-cost strategies in getting better revenues collection in the fast food sector. Looking at the position that the 2014 has on income growing by the reality check is based on the position that the lower food prices which this report assumes are the low-cost strategies have been material of the growth in revenues according to the report (Prime Skills 2014).
5.0 Conclusions
Looking at the interest that this report has been interested in examining, the position that was analyzed was based on the need to assert the fast food industry in Australian and the interest of competition. With this in mind, the position that are described by this analysis will only be material to the suggestions of the strategies that the company has in the management of risk, customer acquisition, and the revenues generation strategies. This, this report has managed to examine the five dimensions of the porters forces based on the interest that the fast food industry has in Australia, specific interest laid on Subway Melbourne. 

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