MGT410_ Panda Express in Brazil

Strategic Analysis & ProposalPanda Express: Expansion into Brazil

Brittagh, Chelsea, Panhia, Sanah

Welcome, Brazil Fast Food Corps!

• Company Background • Panda Express International • SWOT Analysis • Porter’s 5 Forces • Financial Benefits• VRIO• Franchising in Brazil• Panda Express in Brazil• Recommendations

Agenda

Background of Panda Express in the US

•Started in 1973 in Pasadena, California

•Mission: Deliver exceptional Asian dining experiences by building an organization where people are inspired to better their lives.

•Values: Proactive, Respect/Win-Win, Growth, Great Operations, Giving

•More than 1600 locations

•Bright and Fresh Design Concept

Peggy Cherng, Co-Chair and Co-Chief Executive

Panda Express International

MexicoSouth Korea

United Arab EmiratesUnited States

Canada

Strength

● Panda Express is among the US's 25 largest quick-service operations and Asian quick-serve category

Weakness

● Although they do not use MSG and cut fresh vegetables every day, they still have the image of being “fast food”

Opportunity

● Introducing more items on its menu

Porter’s 5 Forces

Suppliers Buyers Rivalry New Entrants Substitutions

Low Low High Low Medium

Financial Benefit For You!Estimated Start Up Cost

Initial License Fee $25,000Lease Building $10,000 - 425,000 Initial 3 months’ RentLeasehold Improvements $ 80,000 - 500,000Furniture/Fixtures/Equipment, & Supplies $ 90,000 - 220,000Initial Inventory $2,200 - 3,600Computer Hardware & Software $14,000 - 18,000Cash Register(s) $ 6,000 - 8,000Insurance $ 20,000 - 65,000 Annual PremiumInitial Training Expenses $13,000 - 29,000

Total: $ 359,200 - 1,509,600

LOW RISK

Internal Analysis

ValueGourmet Chinese food - fast casual environment

The company’s mission

Company Values: Proactive, Respect/Win-Win, Growth, Great Operation, & Giving.

RarityUS leader in Asian diningNo other restaurant like it in Brazil Quick-service chains recent growth of 46%

ImitabilityThe business concepts = tangible resource The business structure & beliefs = intangible resources and adds value to the company and its level of success.

OrganizationPanda Express as a company/ their values/ Panda Cares about the community

A Good Fit?

=

Will a franchise work in Brazil?

As of 2013, Brazil has the third largest franchising system in the world.

The Brazilian Association of Franchising states that, “the sector has been growing 10% to 13% annually for the past decade.”

Brazil is currently the 8th largest economy in the world and is growing rapidly.

Will Panda Express work in Brazil?

According to Global Entrepreneurship Monitor,

between 2002 and 2010, the number of young Brazilians aged between 18 and 24 who became

entrepreneurs rose by 74%.

When asked to describe their main goal for the next 5 years, Co-CEO’s Andrew and Peggy

Cherng responded, “To be recognized as a world leader in

people development.”

Let’s talk strategy...

Recommendations

Case Studies

• McDonalds

• Dunkin Donuts

• Pizza Hut

• Subway

Open in Rio De Janeiro shopping centers

ProposalBarra Shopping Center!

Biggest shopping center in Latin America –

577 stores, 25M shoppers each year

“Some industry observers pointed out that McDonald’s success in Brazil was due to the selection of the local partner that helped the company understand and relate to cultural parameters in Brazil and create a

homegrown flavor without losing the brand specifications.”

Will you take the next step with Panda Express?

Any questions?

ResourcesForbes. (2015). #603 Andrew and Peggy Chang. Retrieved from Forbes: http://www.forbes.com/profile/andrew-peggy-cherng/

Killifer, V. (2011, February 6). Panda Express on Expansion Fast Track. Retrieved from Fast Casual: http://www.fastcasual.com/articles/panda-express-on-expansion-fast-track/

P.F. Chang's. (2015). International Locations. Retrieved from P.F. Chang's: https://www.pfchangs.com/international

Risner, M. E. (2001). Successful Fast Food Franchising in Brazil and the Role of Culture. Florida. Retrieved from http://globalelearning.org/wp-content/uploads/2011/01/Successful-Franchising-in-Brazil.pdf

Sarku Japan. (n.d.). About Us. Retrieved from Sarku Japan: http://www.sarkujapan.com/#about-us

Panhia• http://www.bloomberg.com/research/stocks/snapshot/snapshot.asp?ticker=BOBS• http://www.qsrmagazine.com/growth/translating-american-dream• http://www.euromonitor.com/fast-food-in-brazil/report• http://www.globalelearning.org/wp-content/uploads/2011/01/Successful-Franchising-in-Brazil.pdf• http://www.pandacares.org/about/#prettyPhoto ( Team: videos on Panda Care)

Sanah • http://www.mbaskool.com/brandguide/food-and-beverages/10211-panda-express.html

ResourcesBrittaghInternational Business Publications (2013). Brazil: business & investment opportunities yearbook volume 1.Bank of America (2013). Panda Express continues on its path of rapid growth. Retrieved from: http://about.bankofamerica.com/en-us/partnering-locally/panda-restaurant-group.html

BFFC (2015) http://www/bffc.com/brExport.Gov (2015). Doing Business in Brazil. Retrieved from: http://www.export.gov/brazil/doingbusinessinbrazil/index.asp

Leiboitz, Ed (2015). The Tao of Panda Express. Los Angeles Magazine. Retrieved from: http://www.lamag.com/longform/tao-panda/

OTC Adventures (2013) Brazil Fast Food Corp is emerging markets restaurants at a discount. Retrieved from http://www.otcadventures.com/?p=727

Smith, Daniel (2013). Translating the American Dream. Quick service and fast casual dining franchises. Retrieved from: http://www.qsrmagazine.com/growth/translating-american-dream