Presentation on Burger king industry

Welcome to the World of Burger King

Have it your way

History of

Burger king

Burger King was founded in 1953 by Keith Kramer and Matthew

Burns opened the first Burger King restaurant in Miami, Florida

the company owned or franchised 12,174 restaurants in 76

countries and U.S. territories, of which 1,387 were company-

owned and 10,787 were owned by franchisees

Burger King had long-term exclusive contracts with Coca Cola and

with Dr. Pepper/Seven-Up to purchase soft drinks for its

restaurants.

The restaurant chain introduced the first Whopper sandwich in

1957

QSR sales had grown at an annual rate of 3% over the past 10

years and were projected to continue increasing at 3% from 2010

Burger is the second largest FFHR chain in the world as

measured by number of restaurant and system-wide sales right

now

Burger King’s recently introduced Pizza Burger was a 2,530-calorie

item that included four hamburger patties, pepperoni, mozzarella,

and Tuscan sauce on a sesame seed bun

VisionOffering reasonably priced quality food,

served quickly, in attractive, clean

surroundings

Sell quick service food to fulfil our guest's needs more

accurately, quickly, courteously, and in a cleaner

environment than our competitors.

Grow profitably and responsibly, and provide career

advancement opportunities for every willing member

of our organization.

•Better restaurant operations

•Branded affordability

•Menu variety and beverage choice

•Grow market share

•Maintain debt-to-capital levels to 35-40%

•Create long-term profitable growth for shareholders

Slogan

Corporate Resources

Product : Burger King produces flame-broiled hamburgers,

chicken and other specialty sandwiches, French fries, soft drinks,

and other low-priced food items.

Marketing Mix Price : Burger King recently joined

Hamburgers, Cheese burgers .

Promotion : Burger King operates its business via franchises in

worldwide. Burger king value menu featuring six items at less

than $1.

Internal environment

Turnover Ratios Dec31,

2012

Dec31,

2011

Dec31,

2010

Dec31,

2009

Dec31,

2008

Inventory turnover 226.52 231.22 219.06 214.17 210.96

Receivables turnover 20.04 20.23 20.42 21.45 25.26

Payables turnover 24.14 28.09 25.51 35.76 37.91

Ratio Comments

Inventory turnover Burger king Corp.'s inventory turnover improved

from 2010 to 2011 but then slightly deteriorated from

2011 to 2012. This means performance regarding

inventory increase.

Receivables turnover Burger king Corp.'s receivables turnover deteriorated

from 2010 to 2011 and from 2011 to 2012.

Payables turnover Burger king Corp.'s payables turnover increased from

2010 to 2011 but then declined significantly from 2011

to 2012.

Dec31,

2012

Dec31,

2011

Dec31,

2010

Dec31,

2009

Dec31,

2008

Net fixed asset turnover 1.12 1.18 1.09 1.06 1.16

Total asset turnover 0.78 0.82 0.75 0.75 0.83

Equity turnover 1.80 1.88 1.65 1.62 1.76

Ratio Comments

Net fixed asset turnover Burger king Corp.'s net fixed asset turnover improved from

2010 to 2011 but then slightly deteriorated from 2011 to 2012

not reaching 2010 level.

Total asset turnover Burger king Corp.'s total asset turnover improved from 2010 to

2011 but then slightly deteriorated from 2011 to 2012 not

reaching 2010 level.

Equity turnover Burger king Corp.'s equity turnover improved from 2010 to

2011 but then slightly deteriorated from 2011 to 2012.

Dec31,

2012

Dec31,

2011

Dec31,

2010

Dec31,

2009

Dec31,

2008

Current ratio 1.45 1.25 1.29 1.14 1.39

Quick ratio 1.09 1.05 1.22 0.96 1.18

Cash ratio 0.69 0.67 0.82 0.60 0.81

Ratio Comments

Current ratio Burger king Corp.'s current ratio deteriorated from 2010 to

2011 but then improved from 2011 to 2012 not reaching

2010 level.

Quick ratio Burger king Corp.'s quick ratio deteriorated from 2010 to

2011 but then slightly improved from 2011 to 2012.

Cash ratio Burger king Corp.'s cash ratio deteriorated from 2010 to

2011 but then slightly improved from 2011 to 2012.

Dec31,

2012

Dec31,

2011

Dec31,

2010

Dec31,

2009

Dec31,

2008

Debt-to-equity ratio 0.89 0.87 0.79 0.75 0.76

Debt-to-capital ratio 0.47 0.46 0.44 0.43 0.43

Interest coverage ratio 16.64 17.26 16.53 14.71 12.78

Return on Sales Dec31,

2012

Dec31,

2011

Dec31,

2010

Dec31,

2009

Dec31,

2008

Operating profit margin 31.21% 31.58% 31.04% 30.08% 27.39%

Net profit margin 19.82% 20.38% 20.55% 20.01% 18.34%

Return on Investment

Return on equity (ROE) 35.73% 38.24% 33.80% 32.43% 32.23%

Return on assets (ROA) 15.44% 16.68% 15.47% 15.06% 15.15%

Porter five forces are-

•Industry competitiveness

• Power of buyer

•Power of supplier

• Threat of new entrants

• Threat of substitutes

PORTERS FIVE FORCES

MODEL

Individual state policies enforced by

the government

greatly influenced the international operations of Barger King .

any groups in Europe and

USA clamor for the actions

taken by the state

pertaining to the hygiene, health and

fitness proposition of

eating fast food

In all parts of country and outside the

country government

check all these elements

before issuance of any kind of license in the

respective states

SOCIAL FACTORS:Working within many groups

Increase employment

Customers now opting for more healthy options which

offers more healthier foods.

Internal Factors Strengths (S) Weaknesses (W)

External Factors

Opportunities (O)

SO Strategies

Introduce home

delivery

Improve the products,

it as per tastes of

people around the

world.

Offer various side

dishes.

WO Strategies

Open new branches and

outlets.

Advertise more to

reduce customers

confusion.

Acquire more

marketing strategy to

increase sales

Threats (T)

ST Strategies

Increase the

percentage of sales than

major competitors

Produce healthy and

hygienic food

WT Strategies

Keep pace with the

customers changing food

habit

Reduce concentration

on the specific markets

Internal Strategic Factors Weight Rating Weighted

Score

Comments

Strengths:

Strong market position

Greater franchise mix

Geographic Diversification

Established Market Share

0.05

0.20

0.15

0.10

4.2

5.0

3.9

2.5

0.21

1.00

0.60

0.25

Help them to get

the customer.

Good for the

company profit.

Helpful for

international

market

Enhances profits

promotes growth

Weaknesses:

Market concentration

Scattered Marketing

Campaign

Lack of advertisement

Lack marketing strategy

Total score

0.20

0.10

0.10

0.10

1.00

3.0

2.2

2.0

2.0

0.60

0.33

0.30

0.30

3.59

Can affect its

operations.

Fail to efficiently

promote products.

Damage the

business growth.

Disadvantage spot

in competitors areas

External Strategic

Factors

Weight Rating Weighted

Score

Comments

Opportunities:

New products

development

Brand Licensing

Project

Expand in Asia market

0.15

0.20

0.15

4.1

3.2

5.0

0.61

0.64

0.75

It can increase their

profits.

Increase the company’s’

brand awareness

Important for their brand.

Threats:

Intense competition

Raise of cost

Changing consumer

eating habits

Total score

0.20

0.15

0.15

1.00

2.5

2.2

2.0

0.50

0.33

0.30

3.13

Have to increase sales.

Should minimize the cost.

Maintain the menu of the

food.

Barger King should focus greatly

on building good customer

relationship and uphold customer

retention.

Having a more comfortable

seating and

Dining environment that would

make dining-in more desirable to

more customers

There are three main reasons for

Barger King to focus on the children:(1) Children are one of the biggest

consumers groups to McDonald’s

(2) Barger King believe that focusing on

children can build the stable business, and

will provide the best engine to encourage

the whole family to come to McDonald’s.

(3) By Building a brand loyalty with the

children, Barger King more likely to be

successfully today and in the future.

In my opinion, Barger King is not just selling the happy meal to

children; it is selling the American culture to the children – the

enjoyable individual life.

The burger king have to focus on international

expansion so that they can cover new market in

the Middle East and Asia.

The burger king can do operation analysis of the

in-store work and speed up the system.

Introduce the home delivery at any place.

They can target all ages people to market their

product.

They can introduce more healthier food items to

the health concern people.

BYE BYE, SEE U AT BURGER KING