Pret a Manger Report PDF

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This report is based on the expansion of Pret a Manger services to The Netherlands, and how the company will prosper there. ...

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Student ID Number (Do not include student name as anonymous marking is implemented)

######### BSc Business Management Extended Degree

Programme Title

Module Title Module Code (listed on Moodle and in LTAFP) Module Convenor

Business Organisations and Environment in a Global Context QAB020C410H ########

Coursework Title Report Academic Declaration: Students are reminded that the electronic copy of their essay may be checked, at any point during their degree, with Turnitin or other plagiarism detection software for plagiarised material.

Word Count

2100

Date Submitted

06/09/2017

This report is based on the expansion of Pret a Manger services to The Netherlands. Pret a Manger, Private Limited company which have been first opened and allocated in London (1986). Company strategy form the first day have been the objective to provide good natural food, and use natural ingredients in their products. Business sandwiches are freshly prepared every day in its kitchen; ingredients which Pret uses in their products are brought only from selected suppliers. Company get to the point of worldwide organic food lieder not only through good and tasty food, the main Pret's advantages as a company are taking care of the environment, helping population by the foundation organisation and mainly by providing food which is GMO FREE this is just some of the aspects which help get to the position that they are right now. Pret aim is to became one of the main companies which has efficient business practices, and minimalize the wastage of resources. In year 2015 Pret a

Manger established their strategy for the next 10 years, in which they consider 5 key sustainability in areas of global trends around food, energy, health, as well as in well-being agenda. Pret's main sustainability standards are contribution to society what mean, company want to still provide their charity activities across all stores, through the works of Pret Foundation Trust. Secondly freshly prepared good natural food, is another aim of Pret sustainability, providing fantastic range of natural food, was always have been company mission, and this will always be a point which business will introduce and adapt in their strategy. As an organic food provider Pret a Manger objective is also to manage wastes, company are on track to minimalist their wastes form supply chain, but also through food production and achieve zero waste to land field.

As we can analyse the data from table above, Pret a Manger market share is incising year by year. As company operations are expanding and new shops are opening not just in UK but internationally, in a one-year business have opened 45 stores what is an overall increase of 11 per-cent. In year time company sales increased by 15 percent and overall profit was £99.1 million. Another increase of 11 per cent is a EBITDA with overall income of 8.9 million. Whenever the sales increases, the menu is expanding right after in Pret's organic menu customers can find, sandwiches and wraps, soups, salads and even such. Company also provide for their customers hot and cold drinks, snacks and sweet treats. As sales increase and menu is expanding, competition is a massive factor for Pret a Manger. According to METRO.co.uk main Pret's competitors which are operating on UK land are Costa Coffee with a number of 1,992 stores, following by Starbucks with 849 number of stores and Caffee Nero which have 620 opened stores, moreover in Netherlands competition are already waiting for Pret according to an Time Out Amsterdam mainly operated coffee shops in this area are Abraxas with 800 stores at the second place is Barney's with 750 stores, followed by Dampkring which have 500 stores, but as everyone know competition just push you up to do better.

The reason why Pret a Manger should expand their business to Netherlands are because, country is allocated in Central Europe, population of number 17,116,281 increases with every year. Euro currency is well stable on the market, moreover mainly spoked languages are Dutch and English. However, the most important factor is the growing organic food market. According to Blonext organisation based in Zeist (NL), the Dutch organic food market increased by €1.7 bn in year 2016. From information's included in their reports we can find out that the growth in organic sector increased by 2.6 per cent in yeas 2010 and 2015, with a forecast of 1.6 per cent in a next 5 years.

Secondly on Dutch government website reports we can find out that by year 2020,15 per cent of food production and consumption will be organic. Moreover, according to cbs.nl country also invest in organic meat production as we can analyse from the diagram below between years 2011 and 2016 nearly two third increase on chicken hold, 43 per cent increase on goats hold, and a massive decrease on sheep hold. Overall growth of organic meat hold in years 2011 till 2016 increased in Netherlands by 24 per cent. In the report we can find out information about organic food land use which increased form 447 hectares to 1,254,268m2. Furthermore, Dutch population consumption of organic food increased by 19.1 per cent on vegetables and 20.1 per cent on fruits in years 2015-2017. Finally, organic food market in Netherlands is still growing, as according to organic-market.info population spend €8.7 millions on organic food in just first few months of year 2017.

Main opportunities which are approaching Pret with expansion to Netherlands are new personnel, trained, qualified people are most important asset for every business. Recruiting new talented personnel is real advantage for the company and their profit, however it is an also a good opportunity to recruit and train potential employees which will stay with Pret for years. New employees can contour the process of customer service but also of the way how company operates internally. Furthermore, new employees' equal new ideas. Another opportunity is border customer base, with every expansion come new customers, by expanding service to Netherlands Pret can increase their number of potential customers, what also link to sales improvement and increases profitability. Relocation possibilities is another opportunity for Pret a Manger. By moving to different country Pret can acquire new suppliers and logistic suppliers which is really important factor, trust and stable relationship between the company and supplier can benefit both sides.

Expansion to different country brings different types of factors which can affect Pret's operations. Main legal factors which can affect their operation in Netherlands are pressure about recyclable packing. This can be a massive problem for Pret as most of their products are packed in plastic. To avoid this problem company can analyse their expenses and if possible invest in R&D packing to change their products packing and become ecofriendly. Another factor which can affect the company operations are economic, as organic food market is expanding peoples are still likely to prepare their food at home or go for a cheaper fast food choice. Bringing this factor down to Pret, this mean company will have to be really careful when setting prices for the products they sell, to make sure the price will not scare customers. Moreover, customer service should be provided at the highest level as this always attract customers. Furthermore, customers are now more likely to pay more attention to the cleanness how the food been prepared and stored, to face this social factor Pret a Manger have to make sure to push their production and customer service to the highest standard of level moreover stakeholders of the business should increase the standards of hygiene rating in Pret's stores. Thought my research I have find out

reports about lab-grown beef which is apparently healthier than regular beef, linking this technological factor to Pret it may have influence on the business however it can be in the future not right now as people are not really interested to eat lab produced food. However, company should just keep away from this type of products as it can have a really massive impact on business reputation. Legal factor of calories counting law placed on packing should not really have to be an issue for company as Pret's food in organic and the calories intake from their products are mostly will be at average level, the company can turn this factor into an opportunity. Main environmental factor which can affect Pret is, if the total use of water will still increase by year 2050, 40 per cent of the population will lived in water stressed countries, however this factor do not really have influence on Pret right now, however as this situation will appear in the future business may have problems with suppliers as decrease in water will affect the farmers.

Not only factors can affect Pret in the expansion to Netherlands, there are also setter factors of which main beware or not. Suppliers power can have a large impact in Pret's situation where quality of the products is mainly important in business value and strategy. The main disadvantage for the company is that suppliers have more power, price is also mostly determinate by them, moreover another issue can be a subject of the ingredients availability. Competitive advantages for Pret on buyer's power factor as company only provide fresh and qualitive natural products, for which people are likely to pay more. Competitive rivalry according to Pret is low as their competition like Costa in UK or Abraxas in Netherlands do not have any claims of natural ingredients or products which they are selling. Competitors have alternative products but in terms of quality they are poor. Another force which can be a high influence on Pret a Manger expansion to Netherlands are threat of substitution, for Pret to enter Netherlands organic food sector, and find good price and quality products can be a hard at the start; but in a country where organic food market is still growing can be an opportunity of finding someone for a long tern cooperation. Threat of new entry is actually the lowest force which can influence business operations as company operates in organic food sector for more than 31 years, it will be hard for new entrants to start operate at the same level as Pret.

Pret a Manger as every company which operates in business world has strengths, weaknesses, opportunities and threats all of them can be internal but also, external. Table below shows Pret's SWOT analysis: Internal Strengths  Company operates mainly in city centres with high capital costs.  Pret a Manger suppliers list is really large. External Strengths  Routine

Internal Weaknesses  Low switching costs between competitors for the consumers.  Low switching costs with in the market.

Internal Opportunities  Pret a Manger are training their employees to be sellers.  Large number of suppliers.

Internal Threats  Low switching with in the market.  Sustainable farming.

External Weaknesses  Available

External Opportunities  Regulations of calories

External Threats  Pressure about

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consumers with potential to develop brand higher. Consumers are paying more aware of the products they buy as well as it cleanness.

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substitutes and cheaper options of eating. Large amount of competitor.

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count showed on packing. Concerns with ability.

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recyclable packing. Plenty of substitutes with in Pret's market.

Overall analysis of SWOT for Pret a Manger clearly show that company have potential to expand and increase their services however the number of external factors which I find out in my research can negatively affect company, as they cannot be able to control their growing number of competition, and economic negativities. However, the good site of Pret is the internal and external strengths and opportunities. As one of the main opportunity is stick to the calories counts on their products boxes, just to even make it more official that their products are organic and natural. The final outcome of company SWOT analysis is the number of strengths and opportunities show that company can push in and process to a higher level. However, in order Pret's weaknesses and threats which can be adapt into strengths or completely removed.

In conclusion, Pret a Manger took a lot of effort to get to a place where company is right now, from a little shop opened in London to a one of international leaders in organic food provider. From the first day of company operations till today Pret's main strategy is a providing good, tasty and organic food and coffee. And it works because wherever they expand customers love them, as it is proved by the number of stores company opened around the world and they are ready to open more, as we can find out from their strategic plan for next 10 years. For Pret a Manger Netherlands is some real opportunity as organic food market growths in this country really quickly. Organic food expansion in this country is not only based on fruits and vegetables, but also on meat, milk, eggs etc. Forces and factors do not really affect Pret with expansion to Holland, we can find some points with which company operations may be affected, however the list of opportunities which can approach Pret with this expansion are having really long list.

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