Introduction
The hospitality industry is in the limelight due to new business trends. Firms in the hospitality industry are looking to expand their business in the international markets. International business expansion is a need in the modern business era due to the requirements of customers. However, some strategic considerations, which are triggered by some current business trends, are needed to make the difference or get a competitive advantage. This study revolves around a comprehensive analysis of the hospitality industry and some growth opportunities for Cote Brassiere. The emphasis of the research is on an overview of various sectors within the industry, opportunities for internationalisation, management issues, human resource management, operational process, and some critical future trends for Cote Brassiere in the international market.
An Overview of the Various Sectors within the Hospitality Industry
Sectors in the hospitality industry are visible due to their importance and impact on customers. The elaboration of several areas along with some insights is below.
· Sectors in Industry
Accommodation, entertainment and recreation, meetings & events, travel & tourism services, gaming facilities, catering services, and visitor information services are some prominent sectors in the hospitality industry. Each sector emerged in the hospitality industry. Any hospitality business integrates with customer needs and hospitality industry trends to differentiate the whole process and get a competitive advantage (Novak, 2017).
· Importance & Contributions
Each sector in the industry contributes to the gross domestic product. The business expansion in the hospitality industry may increase sales and revenue streams. An immense range of travellers or tourists depicts their need in different sectors. Thus, sales and revenues are associated with an increased gross domestic product. The hospitality industry increases human traffic in the country, which has a direct impact on economic growth. From the corporate sector to tourism, the need for hospitality organisations has been increased. Different sectors in the hospitality industry represent the culture and the image of the country as well. Differentiated and culturally oriented services for customers can increase people’s mobility. For Instance, in the United Kingdom, differentiated hospitality services made the international community visit the country. In the food sector, accommodation, recreational, and personal service sectors, needs of travellers or natives are to be met effectively. All organisations in this hospitality industry intend to meet the needs of guests and enhance the visibility of satisfaction to support the existence of global communities and economic growth. There is a need to integrate with modern hospitality trends to be relevant. Economic growth and guest satisfaction are one of the primary goals, which have been accomplished in the industry (Statista.com, 2019).
https://www.statista.com/statistics/298260/economic-impact-of-the-travel-and-tourism-industry-in-the-united-kingdom/
Opportunities for Internationalization
The growth strategy for the business
Cote Brasserie aims to expand its business in different parts of the world. The purpose of the business expansion or internationalisation process is to grab an immense range of customers, increase sales, and augment the global market share. However, the growth strategy must be shaped by the company management to emerge in the hospitality industry of other markets. For Instance, if the company wants to expand the business in the United States, it must use a horizontal merger as a key growth strategy. This growth strategy can reduce business risk in the new market (Guillen and Garcia-Canal, 2012).
· Opportunity and fit of the business (12Cs of International Market)
| Country | In the new market like the United States, political stability, stable economic growth, and technological revolutions in the hospitality industry can help the Cote Brasserie expand or enter effectively. The US hospitality industry, including the restaurant and hotel sector, generated $1.5 trillion economic output. It depicts that the US is a potential market for this UK’s firm. |
|
Culture & Customer Behaviour
|
Comparatively, it has been revealed that the United States contains an individualistic culture, which also resembles the United Kingdom’s culture. Cote Brasserie has to incorporate with different customer behaviours, as people in the new market are tech savvy and health conscious. However, customers in the new market like the change with time. It is contradicting with the UK’s customers, as they seem more loyal and satisfied with restaurants. |
| Concentration | In the new market, the management of the company can concentrate on specific groups. For Instance, the firm is in the limelight due to French classic food items. Thus, the primary target in the new market will be French communities or people who like French classics. The market concentration can be done by making different customer segments (Huang, 2008). |
| Communication | The new market contains multiple communication channels to reach customers. The US hospitality industry is triggered by social media marketing trends. Thus, the most important thing is to develop multiple touch points for customers to enhance the visibility of positioning and interactions. Integrated communication can be key to interact with customers effectively. |
| Channels of Distributing
|
Like the United Kingdom, the direct channel of distribution can save the business cost. The customer can interact directly with the management in a different restaurant. The company’s official website and mobile application can also be used as direct distribution channels. |
| Capacity to pay
|
Customers usually have a high capacity to pay for restaurant services. Due to the high-income level and positive customer perception, the ability to pay is expected to be high in the new market. People usually perceive the brand regarding the quality and differentiated services, and it increases the assertiveness when making buying decisions. |
| Currency
|
Business transactions will be done in dollars. Due to the emergence of international communities, Dollar is the most reliable and generally accepted currency. People can use debit cards to pay bills. However, the exchange rate may create an impact on transactions. |
| Consumption
|
The demand for high-quality food is increasing in this new market. It seems an excellent opportunity to meet the needs of customers by providing cultural foods. People’s assertiveness to try different foods makes this market potential for Cote Brasserie. People in the competitive market have become health conscious, and it is a key factor that drives buying behaviour (Soriano-Taylor, 2013). |
| Commitment
|
Selling French food in the new market needs firm obligations. For Instance, quality, differentiation, and staff training are some vital strategic commitments to make a difference. The most important thing is to change the customer eating experience by improving quality and differentiating the services. This strategic commitment can play a role in gaining long-term success. |
| Choices
|
The possible customer choice in the new market is high quality sourced ingredients. Integrating with this choice of customers may lead to customer loyalty and satisfaction. However, with time, the firm may integrate with modern food trends. Integrating with customer choices is the best way to keep customers loyal and satisfied |
| Contractual Obligations
|
Customers may agree to pay if French ingredients or food is original. Authenticity is one of the main factors regarding sales and growth, and it is also a primary obligation of the company. The firm has to meet all contract regulations to be relevant and authentic; any fraudulent activity can impair the image of the company. |
| Caveats
|
The thriving market entry needs integration with FDA regulations. Aligning with laws can make the restaurant business relevant. In every country, the management can face several regulations, which are associated with food quality and production. It can be different in different countries, and the company must be aware of it. Regulations ensure sustainability of the business (Canada.ca, 2015). |
Market Entry Strategy
A merger or horizontal merger can also be used as a critical market entry strategy. However, a joint venture is always a better option for Cote Brasserie to develop a new product or services for customers. It can enable business sustainability in the new market. The most important thing is to find a partner or a company which has potential in the competitive market. The merger is based on this organisational capability.
Management Issues within Hospitality
Management issues within the hospitality, especially the restaurant sector, can emerge. By using several strategic frameworks, the firm can drive some critical insights and make effective decisions.
· Micro Environment
The microenvironment depicts six main factors. These factors are competitors, customers, intermediaries, workers and unions, suppliers and the public. As far as the French restaurants in the hospitality industry are concerned, Les Nomades, Le Pigeon, and Bouche are the main competitors (Lovato, 2013). Customers can be divided into several segments to enhance positioning and attraction. Health conscious and foodie people can be targeted in the new market. A concentrated supplier strategy will be preferred to have access to sourced ingredients. Employees are to be trained in the new country to integrate with culture and modern restraint food and service trends.
· Pestle (Macro Environment)
Political: The United States is politically stabilised. In the democratic political system, business can gain support, which can lead to business growth and sustainability. The political support is in the best interest of the restaurant company in both Canada and the United States. Pertinent legislation can create an impact on business sustainability and performance as well.
Economic: In this developed economy, the company can experience high-income level and capacity to pay for services. The country contains over $19390.60 billion in GDP (Tradingeconomics.com, 2018). Thus, Cote Brasserie can be an excellent addition to the US economy to strengthen the growth rate. It is imperative to emerge in a developed economy and observe favourable buying behaviour.
Social: Aging population can create some issues for the company due to possible lack of adequate customer segments and the shortage of labour. Racial intolerance can hurt the business in this market. However, in the hospitality industry, there is a space to attract people to enjoy high-quality food items.
Technological: New market seems tech savvy, and firms in the industry always intend to gain and sustain the competitive advantage through pertinent technology integration. Thus, technology integration can also emerge as a critical management issue. The firm must evolve with time regarding its technology, as operational improvements and efficiency are two key drivers of the internal business environment.
Legal: Legal factor can also alter management operations. From business start-up to service delivery, legal complications can create hurdles. For Instance, laws such as equal employment opportunity, discrimination act, and equal pay can compel management to alter their strategies. On the other hand, FDA regulations must be aligned to make the business journey fruitful.
Environmental: Firm management can face the most stringent weather conditions. Recently, Ice storms in different cities stopped business and social activities. Thus, the contingency plan is needed to enable business sustainability. CSR initiatives can be taken by the restaurant to be relevant in the business environment. Contributing to sustainable development can be a strategic priority.
· Porter Five Forces
Power of Buyers: Power of buyers seems high due to the availability of different substitutes. However, the best strategy for Cote Brasserie is to increase or justify differentiation in terms of price, service, quality, restaurant design, and sourced ingredients. People want high-quality food in restaurants. The switching cost remains low in the market.
Power of Suppliers: Power of suppliers in the United States is also high due to concentrated supplier’s strategy. High quality sourced ingredients must be accessed through a specific group of suppliers in the new market. Concentrated supplier’s strategy increases the bargaining power of suppliers. However, a strong relationship should be built.
Threats of Substitutes: Threats of substitutes in the United States is always high, especially in this sector of the hospitality industry. Companies with imitating capability can create an impact. Many other restaurants are offering French foods. The broad range of food items in the market is a big threat for the company, as customer conversion is possible.
Threats of New Entrants: New entrants, especially French food firms can create barriers for Cote Brasserie. In this sector, a new company can start with a small restaurant. Thus, the threat of new entrants seems moderate. New entrants in the United States and Canada needs time and cost to create a strong brand image.
Competitive Rivalry: Competitive rivalry is high, as existing hospitality firms have diversified their business in this market, which makes customer conversion quite tough for the new entrant like Cote Brasserie. Competitive rivalry is high due to customer loyalty and satisfaction as well. Even if the company differentiates in the market, it needs to position better to exist in an intense rivalry.
HRM and Operations
Human resource functions in different markets must be shaped to strengthen the internal business environment. In the United States and Canada, the firm must have to streamline some key staffing considerations. Staffing, performance management, administration, and change management are some key functions.
· Staffing
The first step in the staffing process is estimating the employee or workforce requirements. In markets like the United States or Canada, unnecessary inclusion of employees may increase the business cost. Thus, counting jobs and the number of employees is the right approach to have the correct number of employees for the required positions. The second step is recruitment, as Cote Brasserie has to encourage more people to apply for different positions. The maximum number of job applicants can facilitate better screening. After the recruitment process, the company may choose the best candidate for a particular job position and place him according to requirement. Finally, employees selected for different job positions must be trained to shape their behaviour and adapt to the company’s culture. Skill development and career growth will also be a prominent goal of this last step of the staffing process (Durand, 2014).
· Performance Management
Performance management is imperative to improve overall business productivity and efficiency. For Instance, when operating in the United States and Canada, the firm must integrate with the national culture. Apart from this main consideration, the performance will be measured by using Behaviourally Anchored Rating Scales (BARS). It seems unusual to derive some fundamental performance level and assess the behaviour of employees to make better employee decisions (Katerina, Andrea and Gabriela, 2013). Also, the 360 feedback is an appropriate tool in the western corporate culture to assess the performance. Depending on the strengths and weakness of employees, on the job training is the cheaper option to enhance performance (Bracken and Rose, 2011).
· Change Management
As mentioned, the United States and Canada do not contain the long-term orientation, as according to Hofstede’s cultural dimensions, people want to change with time. Accordingly, the change management process can be differentiated by creating urgency. Cote Brassiere will identify the need for change such as a possible change in restaurant design, new product or service development, and change in the menu. Thus, Levin’s change model can be a better option to reduce business distractions. The company will unfreeze operations for a while to make some changes. After making some changes, the company will refreeze operations. In seems precise, short and cost-effective change method, which will be implemented in these new countries or market effectively (Rosenbaum, More and Steane, 2018).
· Administration
The management system must be aligned with the western corporate culture. For Instance, in both new markets, the management will adopt a democratic style. The democratic administration process can assist in streamlining employee’s ideas, reservations, thoughts, and opinions. The most important thing is the work delegation in the internal business environment, which may increase the employee’s assertiveness to make effective decisions. Participative leadership style can express some creative and innovative ideas, which may further facilitate the change process. It can also ensure employee sustainability and reduce employee turnover in the company (Ogbeide and Harrington, 2011).
CSR and Sustainability Issues
When operating in different new markets like the United States and Canada, the business must have to express some key preferences. Corporate social responsibility practices must be implemented to contribute to a favourable environmental impact. Some duties and critical recommendations regarding corporate social responsibility are below.
· CSR Duties & Actions
One of the prominent duties of business management is to analyse the whole hospitality industry environment, especially in the food or restaurant sector. It seems essential to obtain some key CSR trends, which may be implemented as key CSR practices. Another strategic consideration is to assess some available resources in the new market and internal business environment to shape CSR strategies. Different business stakeholders must perceive this CSR intention of the company, and it can also facilitate shaping the behaviour. Thus, these strategic considerations will make the business sustainable.
On the other hand, some actions are to be taken by the management of the company to be sustainable. For Instance, the company can create some new waste management measures. In the restaurant business, trash can be used to recycle different things (Christ and Burritt, 2017). Other strategic actions such as conservative energy resources and traditional water usage are associated with environmentally friendly activities. Conversely, regarding society, some operations such as worker training, equal employment opportunities, equal pay, and alignment with different discrimination acts can be executed to justify corporate social responsibility.
· CSR Recommendations or Good Practices
In these new markets, practising corporate social responsibility is mandatory to sustain the brand image. In the competitive landscape, the management must contribute to social development by supporting charitable organisations. In the United States and Canada, Cote Brassiere can portray an adequate food supply to poor communities. Interestingly, Cote Brassiere can do it in different ways. For Instance, once in a month, the management team can tell customers that their portion of the bill will go to the charity foundation. Another recommendation for the company is to initiate the “Charity of the month.” The firm must derive a portion of its monthly sales for donations. The most important thing is to start smart in these new markets, as far as the impact on the financial condition of the company is concerned (Forafinancial.com, 2018). Apart from environmental and CSR initiatives, Work-life balance is a crucial practice is recommended. Instead of just focusing on profitability and sales, the firm must contain a flexible culture and working environment. Participating in different social activities such as black Friday with employees is another option to show social interactions. These social and environmental recommendations will help to gain promising returns in these competitive markets. The restaurant must measure the performance of employees regarding these CSR actions or strategies as well. The pertinent behaviour of employees can assist in becoming a prominent sustainable firm. All social and environmental recommendations should be communicated to employees in the employee training and development process. Internal stakeholders are primary sources for this restaurant business to implement these CSR recommendations or strategies.
Future Trends and Development within the Hospitality Market
In this contemporary business era, it has been observed that organisations in the hospitality industry like to evolve with time. Business operations and outputs have been changed due to the successful integration with new trends. The successful combination with new hospitality industry trends can enable business growth and sustainability.
· Integration with New Trends
One of the highest-flying trends in the hospitality industry is catering to millennials. It is a fact that the personality traits and habits of these customers are in the limelight. Companies in different sectors of the hospitality industry intend to target 18-34 customers (Dash Foodservice, 2017). These customers travel more than the ageing population in these countries. Thus, it is an excellent opportunity for the management of the company to make several customer segments, meet needs and accelerate sales and growth. Firms like Cote Brassiere must assess the requirements of this customer group, as they have become health conscious and able to pay high in restaurants and many other sectors.
Technology revolution or explosion has become a critical trend that can drive the future growth of the company. For Instance, in this industry, the United States and Canadian restaurants or food companies use different mobile apps to interact with customers. High-level quality equipment makes customers comfortable when travelling, eating, and attending meetings. Cote Brassiere can make a significant shift regarding its operations, as customised menus or order systems in these new markets will also justify the differentiation process (Webrezpro.com, 2019).
Increasing emphasis on health and well-being is another key trend. It has been revealed that different sectors of the industry have streamlined creative wellness options. Customers have become health conscious, as they took charge of food (Webrezpro.com, 2019). Thus, to link with this new trend, the administration must have to create some quality measures. In the operational process, the management of the company can embrace artificial intelligence to assess the needs of employees and customers.
· Impact on Business
The effect on business is positive. It is a fact that many factors can create an impact on the current and future business situation. For Instance, if the company aims to embrace the new technology in the future, it can reduce the business cost and come up with outputs, which have never been experienced in the restaurant industry in the United States and Canada. Associated trends such as health and wellness can increase positioning. Interestingly, integration with new directions can bring many marketing benefits. Cote Brassiere can experience gains in the form of sales, market share, business sustainability, sustainable competitive advantage, and high brand image. Cote Brassiere’s journey in these new markets can be successful if it evolves with time (Dash Foodservice , 2017).
Cote Brassiere will predict the possible impact on the internal and external business environment. All future trends are not to be followed or executed by the company. Cote Brassiere has to be selective to maintain its command in business operations. If a future direction ensures future benefits for the company, it can be followed. Conversely, some trends can be sidelined to protect the business from uncertainties.
Conclusion
In the end, it is to conclude that Cote Brassiere can gain success in the United States and Canada after successful operations in the United Kingdom. Cote Brassiere, due to strong financial capability, can make a successful entry into these markets. However, some strategic considerations and recommendations have been illustrated for this company to ensure some fruitful outcomes. In the hospitality industry, organisations improvise with time to be relevant and lucrative. Both markets are strategically fit for the company, but the future trend must be kept in mind to be appropriate and sustainable. The market is competitive, and rivals may react sharply to convert customers or get an edge. Cote Brassiere’s management needs awareness in the internationalisation process
References
Baynova, Y. (2018) Technologies in the Hospitality Industry: Integrating for Success, 24 August, [Online], Available: https://www.clock-software.com/blog/integrating-for-success.html [3 March 2019].
Bracken, D.W. and Rose, D.S. (2011) ‘When Does 360-Degree Feedback Create Behavior Change? And How Would We Know It When It Does?’, Journal of Business and Psychology, vol. 26, no. 2, pp. 183-192.
Canada.ca (2015) United States Food and Drug Administration and Health Canada Regulatory Partnership Statement, 28 May, [Online], Available: https://www.canada.ca/en/health-canada/corporate/about-health-canada/legislation-guidelines/acts-regulations/canada-united-states-regulatory-cooperation-council/united-states-food-drug-administration-health-canada-regulatory-partnership-statement.html [3 March 2019].
Christ, K.L. and Burritt, R. (2017) ‘Material flow cost accounting for food waste in the restaurant industry’, British Food Journal, vol. 119, no. 3, pp. 600-612.
Dash Foodservice (2017) 4 Food Service trends Driven By Millenials , 5 September, [Online], Available: https://www.restaurantbusinessonline.com/consumer-trends/4-foodservice-trends-driven-millennials [3 March 2019].
Durand, K. (2014) You’re Hired! Building a Career in the Staffing and Recruiting Industry: A Career Guide and Training Manual for Job Seekers and Businesses, Booktango.
Forafinancial.com (2018) How Can Corporate Social Responsibility Help Your Restaurant’s Sales?, 3 April, [Online], Available: https://www.forafinancial.com/blog/industries-we-serve/social-responsibility-help-restaurants-sales/ [3 March 2019].
Guillen, M.F. and Garcia-Canal, E. (2012) Emerging Markets Rule: Growth Strategies of the New Global Giants, McGraw Hill Professional.
Huang, L. (2008) The 12 Cs for Thriving in a Digital World, 15 February, [Online], Available: https://www.clickz.com/the-12-cs-for-thriving-in-a-digital-world/69339/ [3 March 2019].
Katerina, V., Andrea, S. and Gabriela, K. (2013) ‘Identification of Employee Performance Appraisal Methods in Agricultural Organizations’, Journal of Competitiveness, vol. 5, no. 2, pp. 20-33.
Lovato, K. (2013) Best French Restaurants in the U.S., 2 August, [Online], Available: https://www.travelandleisure.com/slideshows/best-french-restaurants-in-the-us [3 March 2019].
Novak, P. (2017) What Are The 4 Segments Of The Hospitality Industry, 24 April, [Online], Available: https://www.hospitalitynet.org/opinion/4082318.html [3 March 2019].
Ogbeide, G.-C.A. and Harrington, R.J. (2011) ‘The relationship among participative management style, strategy implementation success, and financial performance in the foodservice industry’, International Journal of Contemporary Hospitality Management, vol. 23, no. 6, pp. 719-738.
Rosenbaum, D., More, E. and Steane, P. (2018) ‘Planned organisational change management’, Journal of Organizational Change Management, vol. 31, no. 2, pp. 286-303.
Soriano-Taylor, K. (2013) Le Bon Vivant: Understanding French Culture through Food, 7 May, [Online], Available: https://berkleycenter.georgetown.edu/posts/le-bon-vivant-understanding-french-culture-through-food [3 March 2019].
Statista.com (2019) Economic contribution of the travel and tourism industry in the United Kingdom (UK) in 2017, by sector (in billion U.S. dollars), 1 January, [Online], Available: https://www.statista.com/statistics/298260/economic-impact-of-the-travel-and-tourism-industry-in-the-united-kingdom/ [3 March 2019].
Tradingeconomics.com (2018) United States GDP, 1 January, [Online], Available: https://tradingeconomics.com/united-states/gdp [3 March 2019].
Webrezpro.com (2019) 5 Hospitality Trends to Look Out For in 2019, 15 January, [Online], Available: https://www.webrezpro.com/5-hospitality-trends-to-look-out-for-in-2019/ [3 March 2019].
