Essay about Cpk Case Study

3018 Words Apr 1st, 2012 13 Pages
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CASE 33: CALIFORNIA PIZZA KITCHEN

INTRODUCTION California Pizza Kitchen (CPK) is a restaurants services company that operates a casual dining chain, with a particular focus on the premium pizza segment. The company is headquartered in Los Angeles, California and employs 14,800 people as on December 30th, 2007. The company recorded revenues of $633 million during the fiscal year ended December 2007, an increase of 14.1% over 2006. The increase in revenue was driven from its full service restaurants, ASAP restaurants and from LA Food Show. The operating profit of the company was $22 million during fiscal year 2007, a decrease of 28.3% compared with 2006. The net profit was $15 million, a decrease of 29.5% compared with 2006.

In 1985
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California Pizza Kitchen’s inventive menu was not the only draw-in for patrons, their below average check (usually around $13.30) was much lower than their

competitors such as, The Cheesecake Factory, Olive Garden, P.F. Chang’s, Chili’s, Red Lobster, and Panera Bread to name a few. The California Pizza Kitchen chain was labelled by RBC Capital Markets as the “Price-Value-Experience” leader in its sector. California Pizza Kitchen began their growth process by developing the ASAP restaurant concept (located mostly in airports and malls: limited selection of pizzas and “grab-n-go” sandwiches and salads) but later halted all new ASAP locations. California Pizza Kitchen then moved into franchising full-serve restaurants internationally (6 foreign countries as of 2007).

SWOT Analysis Strengths CPK chooses and specifically points out differentiation as its main strategy. CPK

differentiates itself through product quality through the use of quality ingredients, menu design and innovation, and expanded services and offerings beyond their main dining experience. In addition, the management also reviewed detailed sales reports twice a year and replaced slow-selling offerings with new items.

CASE 33: CALIFORNIA PIZZA KITCHEN
⎫ Cost Advantages ⎫ Unique Products ⎫ Technology Give the Pizza Kitchen an Edge ⎫ Strong Management is Helpful for CPKI ⎫ Brand Name - California Pizza Kitchen ⎫ Creative Pizza Ideas

Weaknesses ⎫ Bad Acquisitions Hurt California

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