Mission, Objectives, Goals, Stakeholders

To capitalize on its strength as a support operation to not only provide excellent food but also a cheerful, fun and comfortable environment by employing great "Outbackers"1 and promoting the importance of hospitality, sharing, quality, fun and courage, so that its domestic and future international customers can receive the highest quality of service.

Goals1) Motivate "Outbackers" by encouraging entrepreneurial-ship, personal growth, and the opportunities to learn from mistakes.2) Seek joint venture partnerships and franchising agreements with like-minded franchisees.3) Find countries, which have suitable infrastructure, distribution capabilities and transportation, for future expansion.Stakeholders* Restaurant Customers: depend on Outback for goods and service* Owners: depend on Outback for profit* Joint Venture Partners (Carrabba's Italian Grille): work together with Outback to earn profitable returns* Franchisees: rely on Outback for operational support* "Outbackers": depends on Outback for salary, bonus, promotions* Creditors: the venture capital firm puts importance on Outback's ability to pay back the $2.

5M loan* Suppliers: depend on Outback to continue to be a reliable customer* Community: receives non-profit activities, Outback Bowls, charity golf tournamentsUpdated InformationSince the publication of "Outback Goes International", Outback has already expanded internationally.2 However, this case analysis assumes the expansion has not occurred and will only deal with the information given.General and Industry Environment (O/T)Macro-environmentDemographics (US)1) Trends: By early 1990, US consumers were spending almost as much on restaurants as they do on grocery foods. This increase in spending provides an opportunity for domestic expansion and joint venture projects.2) Trends: Although some restaurants open for lunch, Outback primarily caters to the dinner crowd.

As more restaurants cater to both crowds, this can be a threat to Outback's market share.3) Age: The US population is aging; hence there is an opportunity to make products that cater to the aging trend. From 1994 to 2000, US Census reported that the mean age of the US population increased from 35.8 to 36.6.

4) Ethnic Mix: In 1994, the ethnic mix in the US is white (83%),black (12.6%), American Indian, Eskimo, and Aleut (0.9%), Asian and Pacific Islander (3.6%), and Hispanic (10.

3%). As ethnic mix diverse, some consumers may steer towards the flavors of ethic foods, hence decreasing the market share for Outback.Demographics (International)1) Income: Most citizens in countries like Mexico and China currently cannot afford dining at a Western restaurant. The lack of a high income in some foreign countries is an obstacle for luring a large consumer base.

2) Consumption: Consumption patterns vary across regions and countries.For example, in India, beef consumption is low, and mutton patties serve as an alternative. Different patterns pose as a threat to Outback, for it must create diverse strategies and menus to satisfy various tastes.Sociocultural Segment1) Shifts in Preferences: As people age, more flavor is demanded. Outback is very aware of this shift, and there is an opportunity to exploit different preferences.2) Shift in meat consumption: The in-home consumption of meat, especially beef is declining.

This is a threat to Outback's main product.3) Environmental concerns: Health issues with beef can create a shift in people's choice of meats. Together with the "Shift in meat consumption", they threat Outback's main product.4) Work life quality attitudes: People put more emphasis on the enjoyment of life and life qualities, and this is an opportunity for Outback and the restaurant industryPolitical/Legal Segment ( International)1) GATS3: Franchising scored a win in the GATS agreement.

This topic was addressed directly in international trade talks. As trades rules relax, an opportunity opens for international expansion.2) GATS limitations and Asian Regions Tariffs: Most countries have not made their restrictions on franchising publicly known. With limited information and steep tariffs and inconsistent regulations in Asian regions, Outback's ability to import commodities and equipment is threatened.

Economic Segment1) GDP: In 1994, US per capita GDP is $25868, and as GDP rises spending increases. Outback has an opportunity to capitalize on the higher spending.2) Personal Savings Rate: In 1994, PSR is approximately 5.2 and following a declining trend. As the rate decreases spending increases, and it is a positive trend for Outback, for there may be more consumers.Technological Segment1) Product innovations: Outback makes unique products, like the multi-seasoned croutons.

Product innovations create opportunities for differentiation.Global Segment1) Critical Global Markets: There is an opportunity for growth in Eastern Europe, Soviet Union, China, India, and Latin America.Industry EnvironmentPorter's 5 Forces1) Threat of New EntrantsNew entrants are deterred by Outback's focus on product and service differentiation. The capital required to establish a restaurant chain and become a supporting operation of franchises is also enormous, and lengthy time is needed to establish a niche and strategy. Furthermore, Outback has established distribution channels ranging from solid relationships with suppliers and co-operations with joint venture businesses.

All these factors are obstacles for new entrants.2) Bargaining Power of SuppliersOutback is a supplier of knowledge, experience franchises and food. There are numerous restaurant franchises, so there are many choices for buyers. However, Outback's products are differentiated, and it poses as a credible threat of forward integration, as it is already a seller of foods.3) Bargaining Power of BuyersAs a buyer, Outback has always used the same suppliers. It has an undying commitment to them, and in exchange, it wants them to have an undying commitment in return.

Even in the face of international expansion, Outback wants to keep its suppliers, hence showing extreme loyalty. However, when it seems that the supplier has a lot of power, in reality, Outback is forcing high quality.4) Threat of Substitute ProductsA major substitute product is similar Outback foods available in grocery stores, as cooking at home is still the preferred method of consumption. Also, some companies provide frozen dishes that are microwave ready. This is also a substitute of the dinning experience. In terms of the franchising sector, starting one's own business from scratch is a substitute.

However, the cost and risk of doing so may deter some investors. These substitutes are threats to Outback's foods and services.5) Rivalry Among Competing Firms in IndustryInitially, strong relationships with the local media were used for promotional efforts. Later, full-scale national media programs, such as television advertising and local billboards, were used.

The only printed advertising came as a part of a package offered by charity or sports events. This approach is different from other restaurants, where coupons are printed and there is aggressive media advertising. In a way, Outback takes a different route and does not compete excessively in advertising with competitors.