Posted: July 4th, 2015

The Lotus Garden Restaurant

 

The Lotus Garden Restaurant

Internal Analysis

A brief history and background

The Lotus Garden is a Thai restaurant in the heart of Coral Gables, Florida, one of the most affluent cities in South Florida. The restaurant has been in existence since 1986. The matriarch of the family, Mrs. Nguyen was working at another restaurant when she decided to open her own. They have been open ever since, although they were forced to change locations in 1997. The space they originally had was lost due to the expansion of an adjacent Publix Supermarket.

The Lotus Garden has always been a family run established. They were all born in Vietnam and fled that country after the war. Mrs. Nguyen has three sons and two daughters and all of them worked at the restaurant from time to time. They worked part-time while they were still in school. The restaurant is now run by the oldest daughter Cathy. While Mrs. Nguyen still helps in the kitchen, Cathy does all the cooking and is in charge of the day- to- day operations. The youngest son, Swadee, is the face of the restaurant. He is in charge of the dining area. He takes orders, runs food, and also handles the beverage inventory.

The Lotus Garden closes but five days out of the year, all the national holidays. They open for lunch and dinner, Monday through Friday. Once weekend, they only open for dinner. Peak time for the restaurant is lunch time. Their lunch menu is very popular and they are located near several office buildings. In the evening, dinner is a little slower. However, they do quite well with patrons that order take-out. The dinner crowd is very inconsistent during the week. The restaurant does much better on the weekends.

SWOT Analysis

 

Location of Factor	Type of Factor
	Favorable	Unfavorable
Internal	Strengths   Great Location Friendly Staff Quality Food	Weaknesses   Poor Food Delivery Services for ordered foods Poor Online Ordering Services
External	Opportunities   Expand by adding out door dinning	Threats   Rising Operating Expense   More Competition (Several Corporate-run restaurant)

 

The Lotus Garden Restaurant has a well-stipulated mission statement and from the access, it is evident that the company has strategies that are in line with its mission statement. Additionally, there is flexibility in the mission statement that always gives room for changes as the business environment changes and evolves. This is also crucial as it makes it easy for the employees to understand and share in the mission of the organization (Duncan, Ginter & Swayne, 1998).

The organization has sales strategies that indicate a well-written plan to make their sales. The restaurant’s menu can accommodate anybody, but what it is convenience is that anyone can add or subtract any ingredients from any dish. The family, being of Vietnamese origin, has knowledge of the meals unique to any cultures that works as a competitive advantage for the business. The menu planning is flexible and amicably allows insertion of any new type of product. As identified by Duncan, Ginter and Swayne (1998), this has been one of its core competencies and has enabled the organization establish a unique relationship with the customers. As a result, the organization’s sales volume and profits have been increasing as it has been able to access potential customers based on the quality of their goods and services in addition to extensive marketing of the company via different forums such as the social media.

The Lotus Garden is a family-run restaurant that has a flexible budget that allows for accommodation of any change. The management is Cathy and Swadee, and they work in different departments. As a result, they have the daily running of the restaurant that calls for drawing of a realistic budget. To monitor the progress of the restaurant, the management uses the budget and compares actual against the budget expenditures. In the monitoring process, all the errors are identified and are corrected early to avoid expenses over the budget. It’s flexible pricing policies works to its advantage to balance between their prices and those of their competitors.

Being a restaurant, The Lotus handles their customers diligently. The management ensures that the employees are motivated for quality services assurance to their esteemed customers. The customers are treated courteously; their needs and requests are processed promptly. The restaurant management has devised effective mechanisms to get the customer’s feedback and complaints. This is made easy as the family members participate in customer service that enables them to get the feedback directly from their customers. The Lotus Garden follows appropriate housekeeping procedures, and many of their customers rate the management as knowledgeable due to quick and reliable services that they get from the organization.

The Lotus Garden potential customers know about the business; this mostly arises from its recognized and respected quality services since 1986. Establishing the conclusion from the restaurant’s menu, the meals served are very specific and fits any target cultures. Some foods on its menu are more familiar to people of both Japanese and Chinese culture. This shows comprehensive understanding of their customers. The restaurant has significant customer turn up that indicates the appropriateness of the location. The area has a considerable number of people from the mentioned cultures and due to special diets; there is a significant inflow of customers into the restaurant.

The organization utilizes modern technology in preparation of their dishes and has evolved with social trends. The Lotus Garden restaurant has both Twitter and Facebook accounts besides having online customer care who responds to any query from the customers. The restaurant does not have the option of delivering. They do not offer online booking system where their customers can order. However, they do offer take-out. The company lacks clear ways in which it improves its menu. In the competitive market, it is essential to have research strategies to add new products to the menu and improve in the already existing list of products (Duncan, Ginter & Swayne, 1998). This weakness can work to its disadvantages bearing in mind presence of competitors like California Pizza Kitchen and Season 52 in the area.

Strategic Cost Analysis
Purchased supplies

The company did not reveal much of its supply sources. However, they typically purchase inputs from similar suppliers who are always available. The suppliers need to be always available, especially for the ingredients necessary to prepare fast foods. This is a common phenomenon for the restaurants because once it fails to provide what the customers want then the business is bound to lose them. If the prices for the supplies goes up, then the price is transferred to the customer. This helps Lotus Garden Restaurant keep up with inflation as the commodity costs go up. Due to the diversity evident in their menu, the restaurant also has a diverse range of suppliers of different inputs necessary to make the menu a success.

Operations

The organization has operated for many years and has learned the lean production of goods and services. Their operations are demand driven; they provide supplies depending on the demand at that particular time to reduce wastage of resources. As mentioned earlier, Lotus Garden restaurant is managed by the family and therefore it is difficult to change the management. Retaining the same management for long is advantageous due to the accumulation of experience and mastery of seasons for the demand. Its greatest cost is acquired during purchasing of inputs. However, their flexible budget allows them to meet the demand and reduce the cost on certain foods when their demand is low.

Sales and marketing

Lotus Garden Restaurant knows their customers very well and has served equivalent customers for decades. As a result of operating for a long period and having maintained their menu, many customers visit the restaurant because they have heard of it before. Some of the young people have loyalty to the restaurant because their parent used to visit the same restaurant and believe in their quality. Additionally, the location of the restaurant is a key component to its success; the place has many other operating businesses.

Profit and Margin

Lotus Garden restaurant is a family business and business transactions are kept with some privacy. However, the management professes that they are operating at a smaller cost margins due to its large customer base and lean operations.

Strategic Issues Faced by the Company

From its operations, it is evident that the managers understand the restaurant’s demographic and psychographic profile. However, there are some prospects that remain poorly covered. The company has incomprehensive strategic planning, issues pertaining external environment assessment are poorly covered. Continuous external environment assessment is crucial in handling the ever-increasing competition. The company gives little concern to market research and remains less focused on what their competitors are doing. This might work to their disadvantage in future. They need to formulate a competitive strategies that will focus on improving the quality of their services and products to ensure that they are always ahead of their competitors. The food industry is very dynamic, and therefore failure to establish a competitive strategy to handle challenges from the upcoming and already existing competitors can make Lotus Restaurant grow slowly.

Many consumers look for restaurants where they can eat healthy food and at the same time spend less. Lotus restaurant has a menu that is not very flexible and only minor changes are made on it. It is upon the restaurants to compete for their clients’ needs. Lotus restaurant incorporates the customer’s feedback in their strategic planning but this is not comprehensive enough in addressing the steaming up competition.

Another important aspect of hotel management is training of the staff. There are probable errors during recruitment of many hotel workers because much of their documents contain false information. Lotus Garden needs to have clear guidelines for hiring and training their human resources. This eliminates the risk of affecting the quality and safety of their foods. Customer’s service is one of the most crucial components of any successful organization. The company does not invest much in training their staff. The staff requires to be regularly trained to get updated on the emerging trends. This might require outsourcing to get trainers who are better equipped to sensitize the workers on the emerging trends.

Lotus restaurant is not known to engage in intensive marketing of their products. The organization also requires engaging in intensive public relations to help publicize its brand name. This involves expanding its corporate social responsibility activities to the community.

Strengths and weaknesses

The organization relies on its great customer bases. The organization has a good reputation in the area and has been associated with quality foods for decades. This has worked to tis advantage as it has attracted more customers since the good brand name is spread by the word of mouth. Additionally, having been operational since the year 1986, the organization has the current generation associating it with their parents or any other parties of reference that stimulates urge to get identified with their loved one by joining the same restaurant. The organization has also embraced technology in serving their customers, and currently their customers can order food online and it is delivered to their premises.

The staff working is very friendly. The family works closely with their customers and ensures that all employees observe ethical behavior and courteous language when dealing with their customers. The friendliness of the staff is as a result of training and close supervision by the human resource management. There are disciplinary measures that are undertaken for the staff who mishandles the customers. The quality of food, great location, strong brand name and the friendly staff are the key strengths for Lotus Garden restaurant.

The organization has poor delivery services. In many instances, they are not available to deliver the ordered meals. Their online food ordering services are sometimes not convenient. Additionally, the organization does not engage in marketing its products. It has no clearly laid strategies involving marketing its brand name and foods.

 

 

 

 

 

 

 

 

 

 

References

Duncan, W. J., Ginter, P. M., & Swayne, L. E. (1998). Competitive advantage and internal organizational assessment. The Academy of Management Executive, 12(3), 6-16.