Ch3 HW3 Who\'s Tea - swot analysis PDF

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Who’s Tea- Cambodia Who’s Tea is an international bubble tea franchise that was founded in Taichung, Taiwan. Its brand is centered around being an upscaled boba tea shop that encourages both casual and fine dining, rather than being the traditional boba tea shop that is more casual, with little space, which discourages dining in general. To achieve being an upscaled shop that encourages dining, it has multipurpose lounges that is suitable for business and casual hangouts. Tea, coffee, snacks, and meals menus are designed to match such a setting that requires such a flexible multipurpose. For example, is offers a variety of: pastas, paninis, waffles, fried foods, coffees, and teas (with or without bobas). For the branch in Cambodia, it additionally offers rice sets and hotpot to suit local tastes. Threats of new entrants: Who’s Tea has strong competitors here in Cambodia, especially since its core focus is on bubble tea, which is an Asian drink. Gong cha and Chatime amongst several other brands have the advantage of economies of scale because they are much more well known not just locally but even internationally. Fortunately for Who’s Tea, their business concept and menu distinguish them in this saturated market. The brand loyalty for more well-known brands are retained though a card-mobile point tracking- reward system. Who’s Tea does not have this implemented but should as it would help to increase profitability and help solidify its position in the market. By having card-mobile linked reward system, it could prove to be useful in tracking customer preferences and help gauge the popularity of new drinks. The industry standard for a consistent, quality tea at a reasonable price means finding a good supplier. Fortunately, Who’s Tea has it down and keeps its quality consistent which might be hard for other players trying to enter the market. Bargaining power of buyers: When it comes to drinks, especially something like bubble tea, customers tend to care for quality a little more than price. Thus, prices have a little bit of leeway way. If prices were to increase, they must be subtle over a long period of time. If you want to “decrease” the price, the most common practice would be by doing that through promotions, as having consistently low prices could significantly cut margins. Such promotions would aim to increase the size and number of customers. To tackle substitution, enforcing a reward system as mentioned earlier, would increase the switching cost. The promotions could be done for both non-members or members (loyalty program). Bargaining power of suppliers: Many companies in the food industry buy raw materials from numerous suppliers. However, those with a hold on the market with good, consistent quality leaves and higher negotiating power can demand higher prices which would reduce margins. To elaborate, there is high bargaining power because demand for tea is high globally and most every variety tea grows especially best in places with “high heat, high humidity, and acidic soil”. (seriouseats) To tackle this, it’s best to get a dedicated supplier whose business depends on the company to strengthen supplier intimacy. Threats from substitutes: Substitutes such as soda, coffee, bottled drinks, smoothies, juices are a threat to Who’s Tea core product, bubble tea. Who’s Tea remedy for this is including coffee in its menu and introducing fun new drink flavors and toppings. The stronger the loyalty program and product differentiation, the less likely these substitutes will be a threat. Product differentiation would include things such as flavors and toppings not offered by any other brands as well as combo meal/ snack sets, which for Who’s Tea can be vast in variety thanks to its large menu. Service differentiation would be offering a free meal with x number of drinks to encourage dining (as most boba shops don’t). Because Who’s Tea business model of creating a boba tea shop perfect for casual and business is such a niche in and of itself, emphasizing in its marketing would be very beneficial.

Rivalry: Big time international players such as Gong cha, Chatime, Starbucks, Gloria Jeans and local competitors such as Brown and An cha may prove to be a very intense rivalry in terms of cost leadership, customer intimacy, product differentiation. To combat this there are three things Who’s Tea will do. Firstly, there will be an emphasis on loyalty programs for better cost leadership, strength customer intimacy, and understanding consumer preferences for future product and service differentiation. Secondly, to combat the competitions supplier intimacy, getting a source that will be solely reliant on Who’s Tea, will strengthen its supplier intimacy and decrease bargaining power to help drive down costs. Thirdly, emphasizing Who’s Tea very unique business model is a niche but will at the same time will appeal to a vast audience but most especially to those wanting to do business while having bubble tea. Zeroing in this opportunity, with say a VIP business lounge might prove to be very profitable.

References https://www.seriouseats.com/2019/10/the-future-of-american-tea.html...