1. A few of the chief economic and business characteristics of the global fast-food industry are as follows: In the market growth rate the expected food sales is predicted to increase by $208 billion by 2020 with us already being at $800 billion by 2001. Under entry barriers for the fast-food industry the main concerns would be the entry costs, location, capital cost, and licensing. For a business to have success they must have the right location. Under exit barriers there are land leasing, building leases, capital cost.
2. Some of the driving forces include the quality of the food, price of the food, and the nutritional value. Some of the consumers that are playing an important role in fast food are women employed outside the home, two-earned households, higher income, and smaller size of the family. Increased food spending driven by population growth is just one way consumers will shape the future of the US food system.
3. Five forces:
a. Rivalry among competitors- in the fast-food industry it's who can get the food out the fastest.
b. New entrants- the competition is increasing due to not having many entry barriers.
c. Substitute products- there are many choices in the fast food industry leaving consumers with so many different choices. Therefore each individual fast-food restaurants needs to differentiate their product so people will want to come back for their product. For example what is it about Popeye's chicken vs. KFC's?
d. Suppliers and buyers- in the fast-food industry if the buyers aren't satisfied with the suppliers than they can easily switch their suppliers leaving the suppliers with a disadvantage. Also if suppliers cannot offer something unique that only restaurants can get form them, then they have no power to keep that restaurant's business.
4. A few factors that are critical to success in the fast-food industry are timeliness of the food, quality of the food, quantity of the food, and the pricing of the food.
5. It's attractive in they way that with the fast paced growth of the fast-food industry, there are so many restaurants entering because there are minimal entry barriers. Anyone who wants to open a restaurant can. Also, there are very low switching costs, which make restaurants look very appealing to big corporations. It can be unattractive because more and more consumers are willing to spend more money on better quality food rather than the quantity of food at a fast-food restaurant. Also senior citizens and immigrants are more likely to cook at home and move away from the trend.
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