Professional Documents
Culture Documents
Submitted by:
M Talha Malik 16E00014
Nasir Butt 16E00069
Zoya Farooq 16E00073
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Acknowledgement
First and foremost, we would like to thank Allah for granting us the strength to complete this
project successfully. Furthermore, we would like to give utmost credit to Mr. Faizan Khalid
for providing a valuable source of knowledge throughout this course. During the whole final
project, he has spent much time to help us and has provided us with inspiring advice. Without
his patient instructions and expert guidance, the completion of this project would not have
been possible.
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Executive Summary
The research reported in this study was done on internal and external analysis of “Yum –
Chinese & Thai”. The aim of the study was primarily to scrutinize the internal and external
factors impacting the operations of Yum – Chinese & Thai leading to the profitability and the
sales of Yum. The aspects that were examined during the study were IFAS, EFAS, and PEST
analysis. Primary and secondary data was used for vindicating the issues and the analysis.
Secondary data involved reviewing of the data like already published interviews and
published articles for shaping the proven associations. Primary data was poised through
interviewing the manager of Yum Mr Asif Rafique. The data collected was established in
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Table of Contents
Chapter 1: Introduction.............................................................................................................6
History: .................................................................................................................................6
Overview: .............................................................................................................................. 6
Mission: .................................................................................................................................7
Vision: ...................................................................................................................................7
Cuisine: .................................................................................................................................7
Ambiance: ............................................................................................................................. 7
Chapter 2: Overview of External Environment ........................................................................8
Industry’s dominant economic characteristics ....................................................................8
Current driving forces in the Industry ..................................................................................8
The Supply side:.................................................................................................................8
The Demand Side: .............................................................................................................9
Market: ............................................................................................................................ 10
Porter’s five forces: .............................................................................................................10
Threats of New Entrants: ................................................................................................ 10
Threats of Substitutes: ....................................................................................................10
Rivalry among competitors:............................................................................................ 11
Bargaining power of suppliers: .......................................................................................11
Bargaining power of the buyer: ......................................................................................11
Key Success Factors/Opportunities for Yum: .....................................................................12
PEST Analysis: ......................................................................................................................12
Political: ........................................................................................................................... 13
Economic Analysis: ..........................................................................................................13
Social Analysis: ................................................................................................................14
Technological Analysis: ...................................................................................................14
EFAS .....................................................................................................................................14
Chapter 3: Overview of the Internal Environment ................................................................ 16
Mission.................................................................................................................................16
Vision ...................................................................................................................................16
Leadership ........................................................................................................................... 16
Structure and culture of Yum ............................................................................................. 17
Relevant skills of staff at Yum............................................................................................. 18
IFAS ......................................................................................................................................18
Chapter 4: SWOT .....................................................................................................................20
Strengths:............................................................................................................................. 20
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Weakness:............................................................................................................................ 21
Opportunities: .....................................................................................................................21
Threats: ................................................................................................................................ 22
Chapter 5: Strategic Issues faced by Yum...............................................................................24
Recommendations and strategies ..........................................................................................26
Policies to implement recommendations ..............................................................................26
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Chapter 1: Introduction
History:
restaurant chain serving gourmet Chinese & Thai cuisine. The Yum group is owned by Mr.
Imran Afaq, Mr. Imran Maqsood and Mr. Nisar Chaudhry. The owners’ motto was to invest
at the time when investors were not willing to invest in Pakistan and by doing so, would
facilitate the Pakistan’s economy. They also felt that there was not any authentic Chinese
restaurant in Lahore back then. Yum opened up its first branch in Lahore’s Gulberg area
around the MM Alam locality. Then onwards they opened up in DHA Lahore in 2012 and
have recently opened up in 2017 in Islamabad. Ideally located in the famous/buzzing eating
districts of Gulberg & DHA, YUM restaurants boast an atmosphere that is vibrant, intriguing
and inviting. Combining the warmth and charm of a family restaurant with décor that is
modern ethnic, YUM offers the perfect setting for families and friends to meet, talk and eat in
Overview:
The Yum group comprises of Yum Chinese & Thai Restaurant which has three branches; two
in Lahore as mentioned earlier and another in Islamabad. As the group gained success, it also
had diversified from its traditional Chinese and Thai cuisine into the very desi cuisine by
opening up another restaurant in Gulberg by the name of Spice Bazaar. They also added an
English sort of setup to their chain of restaurants by the inclusion of English Tea House
which serves traditional English breakfasts along with famous lunch and dinner course. Their
restaurants’ entire menu is À la carte other than Spice Bazaar which additionally serves Hi –
Tea. Yum group also took over the famous confectionary chain, Nirala Sweets, and re –
branded it with Chashni - The Sweet House. If the Chinese cuisine is to solely be considered
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then it could be said without a doubt that they are the market leaders and at the moment have
Mission:
“To avail the opportunity at hand, and be the pioneer in providing authentic Thai Cuisine
Vision:
YUM restaurants are committed to providing you with an exceptional dining experience
Cuisine:
Focusing on Chinese and Thai cuisines, YUM offers a variety of conventional and
contemporary dishes to satisfy both traditional and modern/refined food connoisseurs. Each
dish on their menu is prepared to order using the freshest and highest quality ingredients.
Ambiance:
YUM is a Chinese and Thai restaurant that started a new trend by capitalizing on a very
traditional setting which reflects the international Chinese and Thai restaurants by providing
a dark décor, where there is a candle light setup. This candle light setup is made more
beautiful by decorated walls with beautiful paintings and antique pictures along with other
décor equipment such as brooms and wood work. Their setup also incorporates various
festivals and occasions. They prefer going with dark colours such as Red, Black and Brown.
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Chapter 2: Overview of External Environment
Economic growth in Pakistan has historically remained volatile, lacking a stable growth path
and adding to the economic uncertainty about the country’s economic conditions. Historical
data suggests that the economy of Pakistan has reached a high of above 10% growth level in
the early 2000s but following a dip of 5% the economy gained as pace by 3.2% on average in
early 2016. In the food and the beverage industry in Pakistan, there has been seen a growth of
about 9.65% in the year 2016 and 2017 however regardless of the growth food and non-food
inflation have been estimated at 3.9% and 4.3% in 2016-2017 as compared to 2.1 % and
3.3% respectively, in the same period last year. Also given the increase in agriculture
production and sufficient food supplies, effective monetary policy, inflation is expected to
change in the respective years that would ultimately have an effect on the operations of Yum.
The principal meaning of a market is that it is where purchasers and merchants meet. With
the end goal for us to check the feasibility of a business there are these two components
which will assume a key role: the purchaser; the demand side of the business and the vendor;
Given our case of Yum, let’s place it in the framework of a markets as we have set in the past
paragraph. There are certain factors and agents which govern both of the sides. If we begin
with the supplier’s end, we see that numerous process take place to give us the final product
and experience at the Chinese restaurant. These include making inventories for the required
quantity of raw materials, buying the staple materials from farmers, transporting them to the
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restaurant, the actual creation of the food items on the menu and then finally the food being
served to the customers. Now for a business such as this to be successful, there needs to be
proper channelizing of all these processes, not once or twice but on a role every functioning
day of the business. Only thus will the business be able to excel in the beginning and then
sustain its growth in the long run. But if such connectivity fails, the business is at the risk of
failing. For instance, if the farmer is unable to deliver the desired amount of raw material the
product is at stake. Similarly, if the prices of the products keep fluctuating aggressively over
time, the supplier wont be able to predict, calculate and manage their costs and thus again
As we move to the other end of the spectrum, the buyer or the demand side is prevalent. Just
as the word signifies it deals with the customers and their desire to avail a particular service
or use a particular product. It seems very straight forward to maintain a steady demand for a
particular product but there are several factors that determine the demand. Going back to our
case, let’s consider a person who wants to go out and and, how would they choose a
particular spot to go to? (considering that they already do not have a strong preference for
one particular place) In the day and age where we inhabit, advertisement is the main source
of that information, indirectly through word of mouth, if not directly through print or
electronic media. This would become into the reputation of the brand and the brand value
associated with the place. Therefore, experience of the current customers matters a lot in case
of food industry, and only positive experiences of customers would lead to improved good
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Market:
Once we have looked into the two facets of a market place, let’s look at the role that the
market plays while connecting the buyers and sellers. The market does not look at each
player in individuality, rather the market sets a pace which the firm has to follow, and once
multiple firms operate in the same market the problem of externality only rises. Now if Yum
was the only place that offered Chinese then it would have been the first and only choice of
the customer. However, because of the assertion in liberal markets to increase the market
entry of multiple firms and to discourage monopolies, that is not the case. What becomes then
is that multiple competitors begin to enter the markets and become competition of a firm.
Threats of new competitors are moderate for YUM. This is primarily because of the ease of
entry into the market (moderate barrier to entry). This is due to moderate investment
requirements that are required for setting up and the business and for running the business,
(in terms of capital i.e. access to land or assets like furniture and utensils), the product does
require somewhat expertise, the business idea is replicable and there may be access to raw
Threats of Substitutes:
It is high for YUM because there are a lot of substitutes of the business setups of the likes of
YUM like coffee shops, juices bars, cafes, pizza joints, burger joints, other fast food chains
and other fine dining restaurants. Moreover, the product has direct substitutes such as Korean
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Rivalry among competitors:
The Rivalry among competitors for YUM is high primarily because there are a lot of
competitors now offering Chinese and Thai cuisine for example X2, PF Chang’s, Dynasty,
China Town etc. Other than the Chinese and Thai cuisine, there are several other cuisines
such as Korean and Japanese up for grab which makes the competition even stiffer. Market is
very competitive because price offered by all the competitors is very similar from cuisine to
cuisine. Likewise, homogenous product is available to the same customer base which makes
the switching costs for the existing consumers low. The food industry is always growing year
on year as the citizens of Pakistan always have a craving for food and it is considered as one
Bargaining power of suppliers is high in this industry. This is primarily because of only a few
suppliers are available that offer quality products. The meat requirement is very stringent and
only a few suppliers follow the regulations provided by the government and the restaurants
itself.
The bargaining power of buyers is moderate. Customers can switch at will if they want to,
but switching of one customer doesn’t affect the overall business of the company. Therefore,
bargaining power of customers is not high. Usually customers maintain their loyalty when it
comes down to their favorite restaurants. But the buyer has multiple options and places to go
to depending on the mood and the availability of the options available. Since fine dining
restaurants are not open around the clock then customers do favor other readily available
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Key Success Factors/Opportunities for Yum:
• YUM is pioneer in Chinese and Thai cuisine in Pakistan hence providing it a lead in the
business with the attractive brand name and a great ambiance that gives a customer a
• Imported ingredients are used as they have unique sauces which are imported directly
from China and Thailand for the Chinese and Thai cuisines respectively.
• Intense training programs are given to the employees that facilitate customer satisfaction.
demand of Chinese and Thai cuisine in regions like Faisalabad and Multan as deduced
PEST Analysis:
In PEST analysis we consider external forces of the region which can directly or indirectly
impact operations of the business. These include political, economic, social and technological
changes in the environment that can affect different players in the industry. The reason why
this analysis is necessary is that to access the scale and scope of the business we need to
encompass not just the industry but also the external environment of the area in which the
business is operating.
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Political:
Political environment of the country is very unstable and frequent changes in the
governments have been seen in the past few decades. Due to this, varying policies have been
imposed on the country affecting different industries operating in the country. After the
formation of current government, businesses are being enforced to pay their sales taxes.
Restaurants which earlier used to save taxes by hiding their sales are now paying their sales
tax.
Strikes and protests in the country also impact the businesses operating in the country. Sales
of restaurants get greatly affected due to low footfall resulting from the political unrest in the
country.
For the last few years, Punjab Food Authority has been very actively checking the quality and
hygiene of different restaurants which resulted in shutting down of different businesses and
Economic Analysis:
Political instability in the country has caused economic instability, therefore less investors are
willing to invest in small/medium businesses. Due to this, threat of new entrants is not very
high, and only those having enough resources are willing to take the risk.
The cost for running the existing businesses is also increasing owing to the inflated prices in
the raw material, resources and the basic utilities. Buying power of consumers is also getting
low due to inflation, hence fine dining which is a luxury is getting unaffordable for common
people.
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Social Analysis:
In Pakistan, trend of eating out has become very popular in last ten years. Especially in big
cities like Lahore, and Islamabad people do not have enough time and they tend to go to
restaurants for their social gatherings. For small official and personal parties, people like to
go to restaurants so that they can spend quality time with their peers. Approximately 60%
population of Pakistan is youth and prefer to dine out and have small get togethers at causal
places.
People in Pakistan are also getting health conscious due to which they prefer cuisines which
are low in calories. Chinese/Thai cuisine is cooked in a way that there are more
vegetables/meat which are considered healthy by middle aged people and they prefer them to
fast food.
Technological Analysis:
Pakistan is far behind in terms of the technological advancement especially in the food and
beverages industry. Due to this reason, service at the restaurants is slow as compared to
western countries which are more advanced in terms of technology. With the emergence of
new international players in food industry, more innovation is expected to be seen in Pakistan
which will cause existing players to adopt similar if not advanced technologies.
EFAS
EFAS of a company lists the external factors (opportunities/threats) and weightage is given to
each factor. Rating is then given to the company considering how well has it been dealing
with the specific opportunity or threat. EFAS of Yum Chinese and Thai is as follows:
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Weighted
External factors Weight Rating
Score
Opportunities
Business expansion into other cities or countries. 0.16 4 0.64
Increasing trend of dining out and home deliveries. 0.12 3.5 0.42
Diversification of business by introducing catering services. 0.09 2 0.18
Bringing variety in the menu by offering new cuisines. 0.13 4.5 0.585
Threats
Increased competition in the industry. 0.13 4.5 0.585
Regulatory restrictions imposed by the government. 0.15 4 0.6
Devaluation of money resulting in high costs of imported raw material. 0.1 3.5 0.35
Economic and political instability. 0.12 3.5 0.42
1 3.78
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Chapter 3: Overview of the Internal Environment
Mission
“To avail the opportunity at hand, and be the pioneer in providing authentic Thai cuisine
Vision
“YUM restaurants are committed to providing you with an exceptional dining experience
Leadership
Yum – Chinese & Thai was founded by three partners, Imran Afaq, Imran Maqsood and
Nisar Chaudhary. Executive chefs of all branches report to Mr Nisar Chaudhary, hence he is
responsible for taste and quality of the food. Imran Afaq and Imran Maqsood, on the other
hand, take charge of operations. The head count is approximately 200+ employees taking
care of different sub-departments of the three branches such as service, security, and kitchen
departments.
The leadership style is decentralized and suggestions of restaurant managers are given due
importance. There is open communication between the staff members and owners, and all the
employees are treated really well. The owners take ownership and mitigate any issue right
away in case it arises. The overall leadership is therefore very cooperative and there has been
consistency in the leadership style since the directors/owners have not changed since the
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Structure and culture of Yum
The structure of Yum is decentralized, the structure is informal with major chunk of
Yum has a Clan culture in its organization. The reason for it is that there are less employees
in the company. Due to a small number of employees, they work as a family and take part in
everything related to the company. The culture is very friendly and there is open
communication throughout the company. There is a nurturing environment for the employees
with maximum inclusivity and participation. Within the company, there is no concept of
Yum and are able to give their best performance as a team member.
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Relevant skills of staff at Yum
There is an HR Manger working under the owners of Yum, who along with his team is
responsible for hiring the staff. Restaurant GMs also suggest potential employees who can be
Main skill that is required for successful operation of a restaurant is cooking of the cuisine in
which the restaurant specializes. Yum has executive chefs who are highly trained and have
assistant chefs to help them with the work. The team of chefs is supervised by the director
who ensures that all the staff working in cooking department has the skills required to
Service staff works under the general manager of restaurant, and proper training is given to
the employees at Yum to make sure that their service is up to the mark. There is no specific
education required for service employees, however, experience and proper learning is
IFAS
IFAS includes strengths and weaknesses of the company and weightage is given to each
strength/weakness as per its importance. Rating is then given to the company based on how
it’s dealing with a particular strength or weakness. IFAS of Yum Chinese & Thai is as follows
listing all the strengths/weaknesses of Yum and the importance given by the company in
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Weighted
Internal factors Weight Rating
Score
Strengths
Prime locations 0.11 4.5 0.495
Premium quality of food and service 0.09 4 0.36
Substantial Portions 0.05 3.5 0.175
Authentic taste by the means of imported Ingredients 0.08 4 0.32
Highly trained chefs 0.07 4 0.28
Brand image 0.1 4.5 0.45
Weaknesses
Relatively high prices of products 0.11 3 0.33
Slow expansion 0.13 4 0.52
Limited menu 0.09 3.5 0.315
Unavailability of enough space in the outlets 0.1 3 0.3
No discounts or collaborations 0.07 2.5 0.175
1 3.72
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Chapter 4: SWOT
Strengths:
• YUM is pioneer in Chinese and Thai cuisine in Pakistan hence providing it a lead in
the business with the attractive brand name and a great ambiance that gives a
• Loyal labor force as they are compensated well and to increase the retention of the
labor, YUM provides them with handsome Perks and benefits like quarters, food,
living that allows them to save sufficient money which they can send back home for
• The overall culture between the management is very friendly as the owners - cum –
directors have a friendly environment with their staff. This further facilitates
employees’ performance.
• Imported ingredients are used as they have unique sauces which are imported directly
from China and Thailand for the Chinese and Thai cuisines respectively.
• Intense training programs are given to the employees that facilitate customer
satisfaction.
• Chef’s trainings are provided to have their culinary skill levels upgraded.
• Vendors are selected after a scrutinized process which ensures quality raw materials
• YUM does have a top-notch service as it does not compromise on the quality of their
• Their focus is on customer satisfaction and not earning loads of profits as customer
• YUM offers premium quality food and does have substantial portions.
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• Expertise of the management in terms of fine and synergized operations.
• Strong word of mouth has proved to be a good sales driver for YUM ever since it has
come into existence which has ultimately turned into the strength for their branding.
Weakness:
• YUM group did not expand rapidly despite having themselves established as a
popular brand and is still expanding slowly even after giving in 8 years to the food
industry.
• YUM’s menu needs to be updated as they are running pretty much the same menu
• They do run low on staff at times which translates into longer waiting time as
• They do not advertise and do not collaborate with anyone or run any discounts from
their end.
• There is an increased dependence of YUM on the word of mouth medium that could
Opportunities:
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• Franchising opportunity as there is no franchise at the moment of YUM. There is a
demand of Chinese and Thai cuisine in regions like Faisalabad and Multan as deduced
• There is an increased youth population of Pakistan who loves dining out which is an
• Economic condition of Pakistan is favorable for foreign investors as the Pak Rupee has
depreciated a lot against the US Dollar, making it vital for investors to make investments.
Threats:
• There is increased competition and rivalry (direct and indirect) especially in Lahore
and Islamabad. Initially YUM was the only one starting this business but now other
• Increased inflation in terms of the land rents, utility, increased prices of raw material
and other assets for all businesses which is also troublesome for YUM.
• Pak Rupee depreciation translates into higher costs as several ingredients are
imported.
all time or else their reputation will be at stake if they are not fulfilling the criteria of
• Medical tests of food handlers have been made mandatory by Punjab Food Authority
which has increased the cost for the food businesses like YUM.
• There are multiple law enforcement bodies with different laws that food businesses
need to comply with e.g. bodies like PSQCA, Punjab Food Authority. There will be
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emerging new food laws by more food bodies which will add to the financial burden
of YUM.
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Chapter 5: Strategic Issues faced by Yum
• Lack of strategic direction
YUM didn’t expand at the right time. This is when YUM came into existence and garnished a
brand name that people would associate to whenever they would think of Chinese or Thai
food. Yum could have opened up several branches earlier or could have resort to handing out
franchises, however, the owners decided not to give any franchising rights to anyone which
• Long Queues
Long queues are another challenge for them. It is usually observed throughout the week that
YUM is overcrowded and this is due to insufficient tables to cater the potential customers.
This is further fuelled up when their staff does not show up and they run short of staff. The
usual long queues result in customers preferring to go elsewhere rather than wait an hour to
• Limited Choice
YUM’s menu has not been updated since YUM’s incorporation. Several customers demand
the menu to be upgraded. New dishes could be added to the existing menu or even another
menu altogether for the winters. As the menu has been kept to its original one, customers
who prefer experiencing new food or dishes, opt to go to other restaurants where they may
have another option that they have not tried or an option that is well suited for the season.
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• Untapped Cities
There is a potential to expand in various major cities of Pakistan. Faisalabad and Multan has
a great potential as people belonging to these cities have a great craving for food which at the
YUM is dependent on their suppliers as there are only a few that are offering the required
quality. It is due to this fact that they need to get into a contract with their suppliers for a
• Dependency on Imports
At the moment they are importing their sauces, although it maintains authenticity of the true
Chinese and Thai taste that YUM is offering but at the same time it relies heavily on their
foreign suppliers. This dependence means that if their supplies get stuck in customs they may
falter. Furthermore, as the Pak Rupee depreciates, they would be incurring higher costs.
Yum does not offer any promotional discounts to their customers and neither does it have any
collaboration with anyone. Due to this reason customer can choose other competitors who are
offering discounts.
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Recommendations and strategies
• Expand into new cities or regions.
• Open up for franchising. Franchises can be offered to people who might be willing to run
• Expand by making another floor and include more tables. Furthermore, ensure the
• Educate and develop existing and potential suppliers as per YUM’s quality requirement.
• Develop local suppliers in order to reduce the dependency on international suppliers and
to cut down on costs during this phase of the economy when Pak Rupee in constantly
depreciating.
• Structure out a franchising plan and carefully look into the financials and prerequisites
ensuring their repute does not get affected by handing out franchises to unreliable
investors.
• Monitor loyal customers by having their details added to YUM’s database and
• Collaborate with banks like other restaurants do, and offer discounts as per bank’s card’s
prestige level.
• Analyze the peak hours and days and accordingly mange staff by ensuring that sufficient
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• Provide trainings to suppliers to have them meet YUM’s requirements and do have pilot
testing.
• Develop suppliers who could possibly crack down and bring in almost similar taste as
that of the imported sauces. Have the sauce tested by the head chefs and also conduct a
• Team up all the head chefs of YUM restaurants and evaluate competitors to bring in up-
gradation in menu and add seasonal menu after thorough market research an year in
advance.
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