Business Analysis : Caffe Nero : Imc Proposal Essay example
3232 Words Jul 28th, 2015 13 Pages
1. Situation Analysis
1.1. Industry Analysis
Britain is now a nation of great coffee drinkers. Here, we want to use PESTEL framework to analyze the UK coffee market.
Political Coffee beans are largely grown in developing countries. In order to lower the cost of raw material and thus reduce the production cost, the import countries and the tariffs and tax should be considered.
Economic The coffee industry continues to be one of the most successful in the UK economy although it has experienced a 15-year continuously grow. Costa (1,670 shops), Starbucks (790) and Caffè Nero (560) remain to be the UK’s leading coffee brands with 54% branded market share.
High profits are throughout the coffee industry. At the top end, specialist coffee retailers often price premium to attract target customers who desire for high-quality beans and the high-end experience. Even in pubs and fast-food chains, which cut the price for jostling the market share, the profit is still considerable.
Social The British often go to specialist coffee shop for coffee and also for breakfast. Profits from selling coffee are considerable, so that many companies compete intensively to grasp a cup of cake.
In recent years, consumption on coffee in the UK is increasing rapidly. About 1.7billion cups of coffee are sold from more than 18,000 outlets each year in UK, and the number of outlets is expected to rise to 21,000 by 2020. The incremental consumption and the growing…