DETAILS OF ASSIGNMENT STUDENT NAMES: IDS: Brian Bigelow 6298818 UNIT CODE * NAME MKT10007 ASSESSMENT TITLE Major Assignment Part 1 TUTOR’S NAME: Bernadette Van Lunenburg DATE OF SUBMISSION: 09 April 2017 DECLARATION We declare that ( the first four boxes must be ticked for the assignment to be accepted): X This assignment does not contain any material that has previously been submitted for assessment at this or any other university. X This is an original piece of work and no part has been completed by any other student than those signed below. X We have read and understood the avoiding plagiarism guidelines at http://www.swinburne.edu.au/ltas/plagiarism/students.htm and no part of this work has been copied or paraphrased from any other source except where this has been clearly acknowledged in the body of the assignment and included in the reference list. X We have retained a copy of this assignment in the event of it becoming lost or damaged. X (optional) We agree to a copy of the assignment being retained as an exemplar for future students (subject to identifying details being removed). Student acknowledgement (each member of the group must agree to the above before including their typed name below): Date: Brian Bigelow 09 April 2017 DETAILS OF FEEDBACK Office Use Only Date Received Received by Total Mark / Grade Marker Fundamentals of Marketing MKT10007 Major Assignment: Part 1 Topic: Healthy Food Inc. Marketing Report Healthy Food Inc. ‘Simply better for you’ Group Members: Brian Bigelow - 6298818 Table of Contents Buyer Behaviour 4 Macro-Environment 5 Micro-Environment 6 Buyer Behaviour In our chosen market of the Western Suburbs of Sydney, the fast food and quick service restaurant sectors are quite mature. Consumer motivations for visiting fast food outlets or quick service restaurants is primarily based on convenience and cost with two thirds of the population basing their decision on these two factors alone with a healthy choice being important to 28%. This indicates that location, product cost and healthy offering will be essential to meeting the consumers need. 81% of Australians will eat out at least once a month, more than half will visit a fast food outlet or quick service restaurant. Quick service restaurants attract all income brackets as their favoured fast food option with students, sales people and labourers being those who most frequent quick service restaurants. Consumers evaluate alternatives such as McDonalds, KFC and Subway as a safe option as they know what to expect and receive a consistent experience at each visit. It is our belief that a major factor in the success of the proposed business will be finding locations which are convenient to consumers with high visibility and a fixed healthy offering, consumer income does not seem to be a large factor. Healthy Choice inc. will be able to take advantage of the limited healthy options currently available in the quick service restaurant space and build on their green credential by meeting customer needs and offering; - Superior quality offering of organic and chemical free produce - Corporate catering - Biodegradeable packaging - Onsite waste processing – ie. Biodigester ( www.waste2go.us ) - Build green credentials and use in attracting a customer base which values green initiatives - Address the need that many consumers have that their food be sourced ethically and minimise the impact on the environment The level of obesity is 27% with a further 33% being overweight in Western Sydney, while fast food may not be entirely responsible there is clearly a need to provide consumers with a convenient and healthy alternative to those currently available. References: www.myhealthycommunities.gov.au/Content/publications/downloads/NHPA_Report_Overweight_and_Obesity_Report_October_2013.pdf Table 1. www.ausfoodnews.com.au/2014/03/17/australian-fast-food-‘emma’-survey-findings-released.html www.waste2go.us Macro-Environment The fast food or quick service restaurant industry in Australia services consumers with a variety of offerings such as burgers, chicken, sandwiches and pizza and is a mature industry. These are offered in a variety of formats such as drive through and takeaway, food vans and quick service restaurants. Growth in this industry has been strong over the previous five years and growth is predicted to increase by another 3% over 2016-17, this industry is not strongly regulated. This market is affected by rising discretionary incomes, convenience, health consciousness and greater hours worked all making this industry more appealing to consumers. Australia’s food culture has changed over the last five years with premium quality offerings increasing along with the rise of a “foodie culture” allowing some operators to differentiate their offering based on healthy, quality and organic options, some encumbent businesses have struggled to change consumer perception with healthy options such as McDonalds. Consumers between 15 and 24 years are primarily driven by convenience, but there has been an increase in health consciousness within this group over recent years with some increased demand for premium products these consumers are choosing café’s and restaurants over the general fast food option. The trend of substituting Café’s and restaurants for fast food options increases for consumers between 25 and 34 years due to the higher demand for for healthier and premium options. Convenience and delivery is a driving factor for time poor families withsmall children and discretionary income. Increased healthy options introduced over the last five years have slightly increased this sector of the industry for consumers between 35 and 44 years. The largest segment is that of consumers where both parents work and have children and the demand for fast food is driven by convenience and are typically aged between 45 and 54. As Australian’s are aging they tend to look for more healthy options with fast food being a treat, this is noticeable with consumers between 55 and 64 years. Technology in this industry covers the full spectrum from very minimal to extensive systems providing analytics depending on the size and complexity of the operation. The technologies having the greatest impacts are services such as Menulog which enable smaller businesses to have an online ordering facility for pickup or delivery. Online ordering and convenience is only enhanced with smart phones and other devices. Fast food retailers have increasing competition from convenience stores and supermarkets expanding their offer to include ready to eat options, further competition is found with many restaurants offering products such as take away family packs. References: IBISWorld Industry Report H4512 Fast Food Services in Australia February 2017 IBISWorld Industry Report OD4025 Pizza Restaurants and Takeaway in Australia July 2016 IBISWorld Industry Report OD5498 Fast Food Burger Shops in Australia September 2016 Micro-Environment Publics The primary micro environment publics which will impact on the proposed business are the general publics and their attitude to the company products, services and positioning and the internal publics in that employees of Healthy Food inc. should also be committed to the ethos of the business and support it fully. While this industry is not heavily regulated it is appropriate to understand the Trade Practices Act and maintain a watch on government and regulation changes which may have impact. A financial institution such as the Bendigo Bank has good green credentials and may be seen as a good complimentary match for Healthy Food inc. ethos/ Currently they have offset their vehicle carbon emmissins, have reduced their energy use, offers green loans and educates their customers on more eco friendly ways of living. A partnership with such an entity may be advantageous to both. Suppliers The rise of the health conscious consumer has been acted upon by the livestock industry with a number of organic certifications available for livestock and poultry the demand for this product is predicted to increase by an annualised 15.5% over the next five years ensuring an appropriate supply for Healthy Food in. While there is competition in the organic meat segment there is also ample opportunity Healthy Food inc. to differentiate it’s offer so as not to compete directly with major players. Organic farming in Australia is currently undergoing strong demand driven growth and relates to crops which have been certified organic according to one of many certifications. This segment is currently attracting new growth and should ensure an appropriate supply for Healthy Food inc. Organic farmers tend to concentrate on one or two products so a number of supply contracts will be required. Competition The greatest threat to fast food outlets and quick service restaurants over the next five years is likely to come from supermarkets and chain stores increasing their prepard mael offerings. Restaurants and café’s will continue to capture a measure of the quality and health conscious consumers with a range of quality meal options offered in a convenient way. In order to differentiate from other businesses in the sector it will be necessary to appeal to consumers based on convenience, quality and price in addition to educating the market place about the benefits of organic and chemical free produce to build and maintain a customer base. Part B References: IBISWorld Industry Report OD5462 Organic Livestock and Poultry Farming in Australia October 2016 IBISWorld Industry Report X0013 Organic Farming in Australia October 2016