Joe and the Juice Strategy Report - External and Internal Analysis PDF

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Summary

External and Internal analysis as well as recommendations in order to improve operations strategically....

Description

Strategic Analysis Joe and the Juice - Brighton !

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Candidate number: 217065! Word Count: 1578"

Introduction

Joe and the Juice is a well known brand that has opened it’s doors to Brighton recently. This report will assess Joe and the Juice’s strategy through analyzing their external and internal environment, and business model.

Task 1: External Analysis

STEEP Analysis STEEP analysis takes into account social, technological, economic, environmental and political factors that could be key influences of the macro-environment and their impact on the industry and organization. Flexible businesses that can adapt to change will be more successful than other businesses. Planning based on STEEP elements allows businesses to have first mover advantage and enables businesses to determine changes to environmental factors. (Lomine, Muchena, and Pierce, 2014) Sociological

Technological

Economic

Ecological

Political

Changes in health and lifestyle trends post pandemic.

Widespread use of food delivery apps.

Brighton is known to be one of the best cities for new businesses.

Demand for transparency regarding environmental impacts of business operations.

Brexit negatively impacts the business environment.

A rise in health conscious, vegan and vegetarian consumers.

Use of a personalized Joe and the Juice app.

Economic recovery post Brexit and covid-19 lockdowns.

Increase in environmentally conscious consumers.

Purchasing power of consumers post covid economic implications.

Figure 1: STEEP Analysis for Joe and the Juice - Brighton.

Insulate Britain protests on environmental practices.

Brighton is known to be one of the best cities for new businesses. (The Argus, 2020) Although Joe and the Juice is a long standing franchise, it has only recently opened in Brighton. Considering the economic implications of Brexit and Covid-19, this may not be the best time to open a new business in a new city. The economy is still recovering, which means that the purchasing power of consumers has changed. Due to rising prices and high rates of unemployment, Joe and the Juice is slightly expensive considering that there are many substitutes in Brighton.

Globally there has been a significant increase in health conscious, vegetarian, and vegan diets. More specifically, there has been an increase in demand in Brighton as it is known to be a very diverse city. (Hancox, 2018) Local businesses have adapted accordingly and many businesses have emerged that are strictly vegetarian and vegan. Joe and Juice have an advantage here where they do not only provide healthy products but have a wide range of options for those on vegan diets. For businesses to succeed in Brighton they must consider providing sufficient dietary choices for people rather than having the organization be strictly vegan. This allows for a larger amount of consumers rather than having a very targeted market.

There has also been a significant increase in environmentalists and an increase in demand for environmental transparency. Joe and the Juice have been successful in providing sufficient information on their waste management and sustainable practices. All products used by Joe are recyclable, they have also installed three labeled bins that allow their customers to recycle in-store. (Joe and the Juice, 2021) Many consumers in Brighton have been putting those bins to use as observed during store visits. They have also created a waste app in order to track how much they generate and where it is going. Joe and the Juice have been committed to being environmentally responsible in their business operations and have also created a plan that will be fully executed by 2024. (Joe and the Juice, 2021) As they operate in Brighton, Joe and the Juice benefit from Brighton’s commitment to the green agenda which addresses climate change. (Williams, 2021)

The political environment must be stable for a business to succeed. Considering the Brexit implications discussed above as well as the Insulate Britain Environmental protests, it could be more difficult for businesses to survive. The environmental protests have also made it difficult for suppliers to deliver to businesses including Joe and the Juice. The cafe has run out of specific products such as Oatley and vanilla milk on numerous occasions which was observed through several store visits. Both Brexit and the pandemic have played a significant role in current supply chain issues in Brighton, and have further exposed the scarcity of lorry drivers, which has resulted in recent shortages of products for businesses and some empty shelves for customers. (BBC News, 2021)

As for the technological factor, the widespread use of delivery apps make it easier for Joe and the Juice to provide their products to consumers without having them come into the store. This is very practical as they can be found on more than one app. Joe and the Juice have also developed their own app for consumers who would like to pick up their orders without having to wait in queues and would like to avoid crowds. This app also allows consumers to collect points and in return will receive benefits. This also plays into establishing a strong brand image and loyal customer base.

Porter’s Five Forces

Porter’s Five Forces is a framework for analyzing a company's competitive environment. (Lomine, Muchena, and Pierce, 2014)

Figure 2 The supplier power is relatively low as Joe and the Juice purchase products that could be supplied by different large suppliers. Joe require mostly standard products that can be supplied by either farmers, local suppliers, or large corporations. Also, due to distribution issues, the suppliers are not really reliable at the moment and do not have any bargaining power to negotiate higher prices. This is an advantage for Joe and the Juice who can keep costs at a minimum. As for more businesses entering the market, local smaller businesses will not be able to survive the political climate. Many local businesses in Brighton have reduced the number of employees. It has been estimated that 86% of Brighton’s businesses employed ten people or fewer in 2019. (Williams, 2021) Although there is a need for jobs in Brighton with rising unemployment rates, businesses can not generate enough capital to fund their overheads due to Brexit and pandemic related implications. Businesses that can survive this environment would be larger ones such as Joe and the Juice. (Caddy, 2020) Additionally, there is many locally owned cafes in Brighton that have established a very loyal customer base that will

prefer to support pre-established businesses. Joe and the Juice provides high quality products which in turn have high prices. There are many cafes surrounding Joe’s location that provide similar items, for similar quality but relatively lower prices. With the economic implications on purchasing power, it can be disadvantageous for Joe to maintain these high prices if they would like to maintain a large customer base. (Caddy, 2020) Therefore, the buyer can easily switch to another cafe as there are many competitors as well. Although Joe has many competitors that supply similar products, they are one of the few cafes with a trendy concept. Also, the location of Joe is very beneficial as it lies in the heart of Brighton and is on the main road which means it can be easily accessed. Joe has a unique competitive advantage with their concept and preestablished customer base from other branches across the UK.

The external analysis conducted shows that there are challenges for the business environment currently but Joe and the Juice can easily navigate those challenges and succeed in Brighton.

Task 2: Internal Analysis

Benchmarking Joe and the Juice

Trading Post

Mikel

Starbucks

10

7

7

10

Capacity

7

8

5

8

Location

9

9

7

6

Product Range

9

9

6

9

Customer Service

7

7

9

7

39

38

34

41

Brand Recognition

Figure 3: comparison of key success factors against other competitors in the same area. Joe and the Juice

Trading Post

Mikel

Starbucks

8

5.6

5.6

8

4.9

5.6

3.5

5.6

Location (0.83)

7.47

7.47

5.81

4.98

Product Range (0.8)

7.2

7.2

4.8

7.2

5.32

5.32

6.84

5.32

30.4

31.19

26.55

33.59

Brand Recognition (0.8) Capacity (0.7)

Customer Service (0.76)

Figure 4: comparison of key success factors against other competitors in the same area considering weight.

Key Success Factors

Through the benchmarking strategy, the key success factors in the industry in which Joe is operating become more evident. The most significant competitors are Trading Post, Mikel, and Starbucks. They are the most common coffee shops for a younger customer base which is the target market for Joe. Brand recognition plays an important role

Product range and location are also

in identifying with the business. Joe’s

important key success factors as

logo and concept can easily be identified

customers need a variety of choices

however lead competitors have been in

especially considering dietary

trade in Brighton for longer. Trading post

requirements and restrictions in a

for example have established themselves location which is practical and accessible. in the community, offer a variety of

For Joe this should not be an issue as

products and have a strong customer

they have many items that are suitable

base. This may present as a challenge

for different diets and can easily adapt

for Joe where they must attract

any item in order to fit the requirement.

customers and allow them to identify with

The location of Joe is also unique where

the business. However, Joe does have a

it is on the main street of Brighton while

strong brand image and can be able to

other competitors are located in the

overcome such challenges through

Lanes or residential areas and are not

marketing strategies that reflect their

visible from the main road.

corporate social responsibility in order to appeal to the small and close community that is Brighton.

Figure 5

Task 3: Business Model

SWOT Analysis

Figure 6

Joe and the Juice rely heavily on their strong brand image. Joe’s brand is known for its diversity, inclusivity, and social and sustainable responsibility. (Joe and the Juice, 2021) This plays an important role in establishing the businesses in Brighton as it is known for its diversity and vibrance. The trendy concept adapted by Joe is also unique in which many cafes have tried to implement it as well but Joe remains to be the original concept. This also appeals to the target market of Joe as they target a younger consumer base that will appreciate the vibrant and contemporary design and layout of the cafe. Although Joe heavily relies employee performance, the employees undergo extensive training and are highly motivated. Their customer service has also been a reason why customers continue to come back to Joe. (Customer interview, 2021) Joe can also take advantage of several advantages in which they are the only branch in Brighton currently which means anyone who would like access to their products will have to either go to the store or order through delivery apps from this specific branch. Joe and the Juice may face a threat from competitors with loyal customers which is

inevitable in any industry but having unique selling points such as their original concept and diverse products and services will allow them to establish their own loyal customer base. There is room for improvement and development where Joe can start selling retail items such as reusable straws and coffee mugs in order to cut on waste as they are reusable and will allow customers to have Joe and the Juice merchandise which will make their brand recognition stronger. Joe is also known for their sustainable practices in which their cups are made from recycled plastic, using wooden cutlery, bagasse bowls and cups as well made from sugar canes. Their waste is recyclable, compostable, and mostly 100% biological material. (Joe and the Juice, 2021) They also have plans to integrate more sustainable practices such as introducing bagasse straws and improving animal welfare by 2024, which will be done for the first time by any coffee shop in the area. The retail products idea will further strengthen and maintain Joe’s sustainable image. Heavy marketing strategies can also be used to allow customers to recognize Joe’s efforts in supporting cultural and sustainable movements.

Figure 7: Social Responsibility Matrix

As illustrated above, it is evident that sustainability and social responsibility are pillars of Joe and the Juice’s operational strategy.

Conclusion To conclude, the business environment in which Joe and the Juice operates is a profitable one. The strategies they have adopted will definitely appeal to consumers in Brighton and the products and services offered satisfy a demand in the market for healthy, socially and sustainably responsible organizations. Joe’s diverse environment in store allows all sorts of consumers to be satisfied whether they were looking to study, enjoy a coffee with friends, or grab a quick healthy lunch. There are many unique selling points to Joe which will help them succeed in Brighton. However, they can improve in some aspects such as offering retail products in order to live up to competitors such as Starbucks. They can also strengthen their image by being more community involved which will guarantee community support for the organization in return.

References

BBC News. (2021). Impact of Brexit on economy 'worse than Covid’. [online] Available at: https:// www.bbc.co.uk/news/business-59070020

Brighton & Hove City Council (2019). An economic strategy for Brighton & Hove. [online] Brighton, pp.1-27. Available at: https://www.brighton-hove.gov.uk/sites/brighton-hove.gov.uk/files/economicstrategy.pdf

Caddy, T. (2020). UK Coffee Shops Industry Report 2020. [online] Available at: https://store.mintel.com/ report/uk-coffee-shops-market-report

Joe and the Juice. (2021). Sustainability Strategy and Approach. [online] Available at: https:// www.joejuice.com/impact

Lomine, L., Muchena, M., and Pierce, R., (2014) Business Management. Oxford: Oxford University Press.

The Argus. (2020). Brighton ranked as second best place to start a new business. [online] Available at: https://www.theargus.co.uk/news/18140546.brighton-ranked-second-best-place-start-new-business/

Hancox, D. (2018). The unstoppable rise of veganism: how a fringe movement went mainstream. The Guardian. Available at: https://www.theguardian.com/lifeandstyle/2018/apr/01/vegans-are-comingmillennials-health-climate-change-animal-welfare

Williams, L. (2021). Brighton’s future hangs in the balance. Investment Monitor. [online] Available at: https://www.investmentmonitor.ai/uk/brightons-future-hangs-in-the-balance...