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Papa John's Pizza Restaurant Case Analysis

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Introduction

Case Analysis Papa John's 14. What are the current production and purchasing (functional) strategies? Papa John's currently follows a low cost differentiation strategy for its production policy."The low cost differentiation strategy concentrates on quality in operations when the cost of doing so is real low." (Parnell, 2008). Papa John's manufactures its own sauce and dough in their quality control centers to ensure quality. They also purchase all of their fresh ingredients from their quality control centers. By doing this they are saving on cost and ensuring their product will be of the best quality. The Company's domestic QC centers consist of 9 full-service regional production and distribution centers and one distribution-only center, supply pizza dough, food products, paper products, small wares and cleaning supplies twice weekly to each restaurant throughout the contiguous United States. (reuters.com). These centers are highly automated which cuts down on labor costs however their production on a business level is fairly labor intensive since pizzas are made individual and to order and then delivered. The R & D department is constantly trying out new recipes and testing out new products. Papa John's follows the differentiation strategy for purchasing. The differentiation strategy means purchasing high quality inputs, even if they cost more. Since Papa John's only use fresh, high quality ingredients they are paying a higher price than some of their competition. ...read more.

Middle

This allows them to act in the best interest of the customers. Strength 4: Efficient Restaurant lay-out Justification Papa John's lay-out is very customer friendly. The lay-out provides employees a clear view of the front of the restaurant to better serve the customers' needs. It also provides the ability of the customer to see the pizza being made. The lay-out of many of Papa John's competitors is not as customer friendly. Most have varying lay-outs and do not allow the customer to see throughout the store, it also enable the employee to not be able to see throughout the store and as a result can affect the customer response time. 17. What weaknesses exist for the organization? Weakness 1: Limited Menu Items Justification Papa John's only offers a few items on their menu compared to that of their competitors. As a result a customer that wants more variety to meet the needs of the entire family may turn to the competition. Offering only appetizers, pizzas and drinks Papa John's may be losing customers to the competition which offers salads, sandwiches, pasta and pizza. Weakness 2: Location Since Papa John's is relatively new to the pizza market, they have not reached the level of their competitors. Most of Papa John's competition has doubled the amount of stores. ...read more.

Conclusion

Where Papa John's only offers a select choice of pizza, appetizers and drinks. To prevent the limitation of capabilities Papa John's needs to offer new and exciting menu items to continue to focus on their motto "Better Ingredients, Better Pizza". Threat 2: Competitions Location Justification Papa John's competitors have twice as many locations operating, this allows the competition to serve more people as well as meet their varying needs. Papa John's could eliminate some of this threat by extending its delivery areas, and also open more locations in the future. Threat 3: Competitions Brand Recognition Justification Papa John's is not the only pizza chain with a brand reputation, therefore the competition can advertise locally , regionally and nationally just as well if not better due to the larger market they are supplying than that of Papa John's. Papa John's can advertise at times when people are more apt to purchasing pizzas, such as football season, basketball season and summer since children are home from school. In the future Papa John's can sponsor more sporting events to get more publicity than just the commercials being aired on television. STRENGTHS | WEAKNESSES | * High Quality Ingredients * Strong Employee Training Programs * Strong Marketing Support * Efficient Restaurant Lay-out | * Location * Limited Menu Items * Switching Costs | OPPORTUNITIES | THREATS | * New Menu Items * Locations * Strong Brand Recognition | * Competitions Larger Menu * Competitions Locations * Competitors Brand Recognition | ...read more.

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