Ruth’s Chris: The High Stakes of International Expansion
A. Defining the Issue
Ruth’s Chris needs to develop a strategy to increase revenue growth to meet stakeholder expectations, by expanding internationally their company-owned and franchisee-owned fine dining restaurants. The challenge is to decide which markets would be best?
B. Analyzing Case Data
-would be franchisees face strict criteria; net worth of $1 million dollars, $100,000.00 franchise fee, 5% gross sales royalty fee, and 2% gross sales fee to the national advertising campaign.
-Ruth’s Chris has grown to be the largest fine dining steakhouse in the United States. It’s success due the focus on customer ...view middle of the document...
iii. Removing some of the restrictions would make it easier for interested entrepreneurs to apply for a franchise, thus opening the door to more opportunities.
iv. This runs the risk of setting a precedence of being an easy franchise to buy into and attracting too many prospects who are not motivated to be successful, thus creating too many opportunities for the senior management to choose from, clouding the serious inquiries.
III. Remove the importing of US beef, from the marketing selection criteria
v. Allow for new international franchises to buy local would support the local economies making a franchise more appealing to local entrepreneurs.
vi. Ruth’s Chris has a reputation of serving the best USDA prime cuts of meat and allowing the newly opened restaurants to purchase local meet could possibly destroy this reputation.
D. Selecting Decision Criteria
IV. The new market that Ruth’s Chris expands into has to meet the following criteria.
vii. have a population of beef eaters
viii. have an ease of importing US Beef
ix. population and urbanization rates going upward
x. marketing selection criteria like; do people go out to eat? do they have an affinity for US brands? are immeasurable but should be not ruled out completely
E. Assessing Alternatives
V. SWOT analysis
a. Ruth’s Chris well established, has a good reputation and is already the largest fine dining steak house in the United States.
b. High quality food and service is what Ruth’s Chris strives to achieve.
c. Strict franchise criteria.