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MKTG 732 International Marketing Plan – Group Project Final

Taking Swiss Chalet to Australia with Market Assessment

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International marketing (MKTG 732)

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Centennial College

Academic year: 2021/2022

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Running head: MKTG 732: International Marketing Plan – Group Project 1

MKTG 732: International Marketing Plan – Group Project Adnan Mehdi 301091381 Andrei Mosquera 301112834 Keshav Agrawal 301108922 Maria Maldonado 301119119 Vriti Kalia 301108877 Centennial College MKTG 732 002 - International Marketing Professor: Lesley Lessard May 27, 2021

1. Executive Summary:

Swiss Chalet, a Canadian casual dining restaurant, was established in 1954. The company is based out of Toronto, Ontario. Over the decades of their presence they have established themselves as an icon of Canadian-Family style dining (Taylor, 2016). Following the success with opening as a Bar-b-Que grill in Montreal its founder Maurice Mauran moved to Toronto after finding an investor and opened the first Restaurant in Bloor Street West. (Taylor, 2016). Swiss Chalet is known for their rotisserie chicken sided with fries and smashed potatoes as the iconic dish. The founder Maurice Mauran also founded Harvey ́s, a famous hamburger restaurant and has been managed by the same food chain as Swiss Chalet (Taylor, 2007). Swiss Chalet has more than 200 restaurants across Canada. It is a signature brand around Canadians and despite their efforts to become international they have not found success outside the Canadian market. In 2011, the food chain closed locations outside Canada which were notably in Buffalo, NY and Puerto Rico. (El nuevo dia, 2011) Recipe Unlimited Operation, previously named Cara Operations, is the largest Canadian operator of full- service restaurants ( Recipe , n.). Along with Swiss Chalet, Recipe Unlimited Operation owns 19 other brands which include, The Keg, Harvey ́s, Montana ́s, Kelsey ́s, St- Hubert, New York Fries, and so forth. In recent times, despite efforts to attract new and younger audiences, Swiss Chalet is facing an aging market while constitute its customers in the 55+ years age gap (Dallaire, 2017). Swiss Chalet partnered with Hockey Canada, as an “international marketing partner” with the aim to attract new customers nationally and internationally and it is also an intensified effort to attract younger markets. (Cision, 2021)

Australian Market with a flow of investments of CAD $ 66 Billion (Statistics Canada, 2018). Both Canada & Australia have a country risk rating of 7 (World Security Risk, 2018). Through this report we address the opportunities that Swiss Chalet could have by entering the Australian market by identifying the risks and characteristics of the target market. The proposed marketing mix to enter the Australian market outlines the target market and identifies reasons why it could or could not be an opportunity for the Swiss Chalet. The recommended strategy for market entry into Australia is recommended around Product, Promotion and Pricing.

2. Brand Analysis: SWISS CHALET - BRAND IDENTIFICATION Brand Name Swiss Chalet Background The first Swiss Chalet was opened back in 1954 in the Bloor Street West area of Toronto. Maurice Mauran of Montreal engineered the brand along with another businessman. Before opening in Toronto, the founder introduced his barbeque style chicken in his Chalet-Bar-B-Q which was inspired by Swiss method of making chicken. This resulted in the brand being called “Swiss Chalet”. After the instant success of the first branch, other two were opened (Taylor, 2016). Today, over 30 Canadian cities from different regions and territories have 200 franchises of Swiss Chalet. Milestones & Results Swiss Chalet celebrated their 65th anniversary in June, 2019. To celebrate this milestone, they offered a one-day special offer to all theircustomers. The opening of the first store was back in 1954 (Media Ltd., 2019). Target Market 25-49 years. They mainly focus on bringing together families, which iswhy their slogan is “Family Happens at Swiss Chalet” (Brown, 2021). But now, they are targeting millennials too. Main Competitors Nationally and Internationally.

In Canada- Barbeque Nation, Smokey Bones, Islands Restaurants, Quaker Steak & Lube, Houlihan’s and Cowboy Chicken (ZoomInfo, n.). In Australia- Hungry Jack’s, Red Rooster, KFC, Guzman y Gomez, Oporto, Nando’s, Grill’d and Subway (Birot, n.). Relation with customer It tries to stay in touch with the customers by sending them emails to know about the customers’ experiences. Also, it promotes the concept of a family eating together and emphasises on spending some quality time with the family. It is also one of the famous restaurant chains in Canada when it comes to their customer service (Brown, 2021). Current Marketing Plan It has improved its marketing plan by targeting millennial families but at the same time stayed connected to its original plan which focuses on family dining together. Its television commercial highlights how millennial families rely on text while deciding their dinner plan. As a result they have introduced a new tagline for their brand “Any day, anyway, dinner’s ready at Swiss Chalet”. It has improved its mobile application so that people can order through Uber and even schedule their weekly orders together (Singh, 2017). Brand ́s Current Goal. After unveiling the new design and menu in 2017 the brands current goal is to provide delicious options for everyone on the table by forging a welcoming, cool and casual environment (Media Ltd., 2017). Another goal they have is to develop the newly opened grocery section(Swiss Chalet, n.).

Trade and Economic Situation.

The two-way trade between Australia & Canada was at $4 billion in 2018. Furthermore, the two- way direct investment of Canada to Australia amounted to CAD $ 66 Billion according to statistics Canada and investments from Australia were CAD $11. Australia is ranked to be 8th Largest direct investment nation by Canada and while Canada is ranked 12th by Australia. Many Canadian Companies consider Australia as a good and favorable location to invest in the south east Asia Region. Australia and Canada share friendly and highly productive relations which can be leveraged by Swiss Chalet.

With globalization it is seen Australians are more receptive to international brands especially those from Canada. According to Data 34% of Australians aged 14 and above said they are more likely to buy Canadian Brands in the year 2006. Australians are known as early adopters as they prefer to buy new products. It is important to mention; Australians have a good standard of living due to the minimum wage policy which helps them to maintain a lifestyle. According to fair commission trade, the minimum wage is AUD $ 18 per hour. With the average minimum wage of Canada being CAD $14 Australians have more buying power. This takes into consideration of the currency exchange being almost at par (1 AUD = 0 CAD). Given this it is favorable for Swiss Chalet to expand their opportunity into the Australian Market. The GDP per capita for Australia in 2019 was AUD $ 53,825 which in Canada was CAD $ 46,213. Australia's Preliminary Estimated Resident Population (ERP) as of September 31, 2020 was 25,693,059. Since 2019, the number of people living in Australia has increased by 0%. Political System The Political Stability index measures the ease with which the government can be disrupted or weakened using any prohibited or violent means such as violence or terrorism. From

the below graphical statistics it can be concluded that doing business with Australia is safe as it substantially generates value. Australia is recognized as one of the destinations to have transparency and well-articulated regulations to welcome investments. Australia has vibrant economic policies and flexible exchange rate(s). The Government of Australia has more favorable trade and investment policies for the United States & Canada in comparison to that of Asian Countries. (Economic and political outline, 2019). The welcoming climate implies that Pajar Canada can expand their business into Australia. Legal/ Regulatory System Australia has a series of policies for companies involved in the food and beverage industry, which has allowed it to have a high standard when it comes to quality[CITATION Ove19 \l 1033 ]. Regarding international trade, Australian food regulation is divided into tariff and non-tariff barriers. Food products entering Australia require classification and declaration to the Australian Border Force. This entity establishes import restrictions, tariffs and quotas, export subsidies and domestic support for agricultural products. Additionally, food and drink imported into Australia must comply with strict biosafety requirements, the Food Standards Code, and the Imported Food Control Act of 1992. Under this legislation, imported foods are inspected and controlled, through a border inspection. Social and Cultural Forces. Australia with a high degree of religious freedom and diversity, is a secular country. In the Australian society religious institutions play a huge role. They own a huge number of schools, hospitals etc. The most seen religion in the country is Christianity. After the abolition of White Australian Policy in the 1970s, the country saw a rise in non-Christian religions in the

enter the Australian market, we are focusing also on Millennials (1976 -1990) and Generation Z (1991 - 2005). According to the Australian Bureau of Statistics, Sydney and Melbourne are the most densely populated cities in the country with an increase of 1 and 1 % in population respectively (Australian Bureau of Statistics, 2021). Establishing the restaurants in those areas can prove to be profitable for Swiss Chalet in capturing more people and developing their own market share. c. Advertising and Promotion As Australia is a low context culture country, the advertisements should be direct with less flashiness so that people do not find it irritating. Marketers have to focus on presenting the direct picture of the product so that people get allured by the advertisement but do not find it repulsive. Australia uses both the traditional methods of advertising like television, radio, billboards transit and digital methods like social media, mobile app, emails etc.(Business.gov, 2020). Brands in Australia use sales promotion like gift with purchase, product giveaways, vouchers, offers, loyalty points etc.(Jess, 2017, #). Several pricing strategies like cost based, competition based, value based and product based are used by the brands in Australia(Business.gov, 2021). The demand by the people also plays a huge role in determining the price of the product. 5. Competitor Analysis: a. Competition

Competition Name Number of Restaurant /Stores

Main Goal Target Market Diversified Products. (grocery frozen meals) Nando ́s 261 total restaurants, 21 Owned, 3 Offices and 240 franchises.

Nandos is aimed at people who want to enjoy a nice casual dining restaurant in a nice atmosphere.

Young population between 18-35 of age.

Yes. Sauces, marinades and dips are sold in supermarkets

Popeye ́s There are 230 stores and 35 new stores are planning to open in the next six years.

Quick-serve restaurant People aged between 25 to 49 years old

Kentucky Fried Chicken

160 stores owned by KFC and 480 franchises.

It aims to not only sell chicken but to offer quick service and open restaurantsacross the globe.

Young population between 18- 55 of age

Red Rooster Over 360 restaurants throughout Australia

To open more franchisees in order to join the next leg of their journey.

People aged between 15- 29 years

b. Competitive Positioning:

Australia’s average age of population is 37 years. Individuals of this age are generally working and have a fast paced life. So, the lunch box meal offered by Swiss Chalet shall be more attractive to customers. Also, Swiss Chalet offers scheduled weekly deliveries that can be ordered by customers at one go which is not offered by any other fast food restaurant. Moreover, Australians are becoming more inclined towards nutritious food. We have seen a trend that many fast food restaurants are failing in Australia as they are not able to offer nutritious options in their menu. So, Swiss Chalet will provide much healthier options in terms of fast food than its competitors which can provide a major competitive advantage to the restaurant. Also, Swiss Chalet has planned to opt for a penetration pricing strategy to capture larger market share and to lure customers. The fast casual dining and the innovative ambience of our restaurant will attract both the young and old generations and will help to reduce the waiting time as well as boredom felt by customers at certain times. Also, the presence of Swiss Chalet in frozen products industry will also provide an added advantage to the restaurant.

The compacted menu can allow the food chain to develop temporary sales and promotions as:

Make your lunch box
Swiss Chalet Classic menu
A typical Australian dish included in the new menu and young appealing options like chicken burgers, nuggets, subs and fries. The aim is to engage with the local (Australian) market so keeping in mind the preferences of the Australians is the key to engage more customers. The compacted menu needs to be as small as a fast food restaurant one and as manageable as a fast food restaurant kitchen can adopt. There is a true chance to compete against main competitors but some size adjustments need to be done in order to appear more reachable to the customer and to the investor. The fast paced life even in the small cities around the world is a decisive factor to make it appear more amicable to the customer, convenient and reachable. Australians are particular about quality and their home country products so local employees and Australian dishes are pertinent for Swiss Chalet to create its name. Main competitors are small - medium “fast food” franchises. Therefore, the real chance to enter new markets is to decrease the complexity of the administrative processes and make it a little self-service kind of a place where youngsters can hang out and as well as families can join in. The “Family Gathered” image as well as the “food made like home food” are strategies meant to keep on going but the ambience should be such which keeps the millennials engaged as Australians have more young population.

Strategy 2: International New Franchise. “Fast Casual” & strategic location ( Place and Promotion ) Typically, Swiss Chalet complies with more franchises than chain management owned restaurants. The business model for the restaurant has been replicated for the chain management company. The strategy seeks to focus on the needs and wants of the internationalized markets. Franchises are mostly preferred as a second income investment. This means that the investors are looking for a business where mere supervision is needed. They are not looking forward to owning a full restaurant. The best possible chance for Swiss Chalet to accomplish the franchisee mode is, adapting to the increasing international needs for practicality. The “fast Casual” strategy seeks to eliminate waiters and personnel from the restaurant. Food is to be bought and ordered at the counter and served in there. Customers can take it out or decide to stay within the facilities. The “Fast Casual” strategy allows franchises to have a “homemade meal” on the go, in places like airports, shopping malls, business centers and or walking streets. Swiss Chalet should promote a chilled out ambience which attracts millennials but at the same time stick to its core values of promoting family dining together. Strategy 3: Grocery Products on retail - Strategic Partnerships with Woolworths. (Product and Promotion) As per in Canada, Swiss Chalet partnered with truly Canadian Grocery Chains. This helped the sense of identity of the brand. People want to eat a meal that is “prepared as home” from where their “home” is. In this case Woolwoths chain is the most recognized brand in Australia. A strategic partnership could allow the Australian identification of the brand and the

7. Summary:

Due to the busy lifestyle of the increasing number of working population a rise in demand is seen for healthy and preferred home cooked food. The Targeted location is Sydney & Melbourne with the potential of 11 million consumers, increasing everyday, and with increased focus towards unique offering of on the go healthy food bundled with presence of market proven frozen category Swiss Chalet is positioned to taste success in the land of Kangaroo, Australia.

Appendix

(Doing Business, 2020).

References (2019). Overview 2019 Food & Beverage Industry Market. FLANDERS INVESTMENT & TRADE MARKET SURVEY.

AIPT. (2020, June 19). Australian Eating Habits and Statistics. Australian Eating Habits and Statistics AIPT. aipt.edu/articles/2020/06/australian-eating-habits-statistics Australian Bureau of Statistics. (2021, March 30). Regional population. Regional Population, 2019- financial year | Australian Bureau of Statistics. abs.gov/statistics/people/population/regional-population/latest-release Birot, M. (n.). Fast Food (Quick Service) Restaurants. Canstar Blue. Retrieved April 05, 2021, from canstarblue.com/stores-services/fast-food-restaurants/ Brown, D. (2021). Family Marketing with Swiss Chalet. DB. Retrieved 04 05, 2021, from dannybrown/2009/02/16/family-marketing-with-swiss-chalet/ Business.gov. (2020, June 24). Advertising for business. Advertising for business | business.gov. business.gov/marketing/marketing-and-advertising/advertising-for-business Business.gov. (2021, March 12). Develop a pricing strategy. Develop a pricing strategy | Business.gov. business.gov/products-and-services/develop-a-pricing-strategy Cision. (2021, December 18). Hockey Canada Announces Partnership with Swiss Chalet. Retrieved April 05, 2021, from newswire/news-releases/hockey-canada-announces- partnership-with-swiss-chalet-860267143 Cultural Atlas. (n.). Australian Culture. Australian Culture - Religion - Cultural Atlas. culturalatlas.sbs.com/australian-culture/australian-culture-religion#australian-culture- religion

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