1. Competitive Analysis Group 3 Garrett Matthews David Hayward Cory Logan Nick Watkins Mayra Garcia Lindsey Pacatte

2. Strengths Expert ManagementAtmosphere Global Brand

3. Opportunities International Market Recession Fish Sandwich

4. Weaknesses Breakfast Menu Management Problem

5. Threats Food Borne Illnesses Increase in Beef Prices

6. Wendy’s SWOT Analysis Internal FactorsExternal Factors Favorable Factors Strengths Expert Management Atmosphere adds value Global Brand Strong Supply Chain Opportunities International Market Advances in Technology Fresh Burger Market Recession Unfavorable Factors Weaknesses Breakfast Menu Management Changes Threats Food Borne illness Increase in Beef Prices

7. Key Success Factors Contribute to a company’s competitive advantages by identifying components that the company performs well in. ◦ Competitive Factors ◦ Managerial Factors ◦ Financial Factors ◦ Technical Factors

8. Competitive Factors Product Strength Lack of differentiation Unique patty shape Customer Loyalty and Satisfaction Convenience Speed of service

9. Competitive Factors Market Share Third largest company in QSR Introduction of new products Customer Concentration Location variables Strengthen penetration

10. Competitive Factors Cost Control Centralized distribution center Reduce labor costs Economies of scale Investments International fast food markets Knowledge of foreign markets

11. Managerial Factors Corporate Image ◦ Structure and culture Social Responsibility ◦ Dave Thomas Foundation for Adoption Receives 2009 PR News Corporate Social Responsibility Award

12. Managerial Factors “Doing What’s Right for Our Customers” ◦ Focusing on core: Hamburgers ◦ Build on the success of Baconator ◦ Emphasize product being fresh never frozen ◦ Updated menu: appeal to 18 to 34 year olds ◦ New image by capital reinvestment ◦ Total customer feedback system

13. Managerial Factors Strategic Growth Plan ◦ Phase 1- revitalizing the brand name and growing sales and profit ◦ Phase 2 – plan to build on that success by continuing to improve on company name and brand  “Doing What’s Right for Our Customers”

14. Financial Factors: Current Ratio Over the 5 year period, current ratio for Wendy’s peaked of 1.66 in 2006 See a downward trend since 2006 Wendy’s current ratio was at.76 for 2008 This.76 current ratio can affect Wendy’s ability to secure short-term financing from both creditors and investors Wendy’s currently has the lowest current ratio of all the benchmark companies

15. Financial Factors: Current Ratio Wendy’s current ratio is not a concern currently The concern is the downward trend in its current ratio This downward trend will directly affect investors and creditors decision making They have the lowest current ratio making them more of a risk compared to the benchmark companies

16. Financial Factors: Return on Equity Wendy’s was highest in 2005 and 2006. Most years there was an above average return for other companies. In 2007, Wendy’s saw about a 6% drop in ROE from 2006. In 2008, Wendy’s reported a loss of $480,000.

17. Financial Factors: Return on Sales Wendy’s is volatile. ◦ Food prices; fresh never frozen ◦ Low margins; competition ◦ Must control cost Overall McDonalds and Sonic had some of the highest returns ◦ Utilize economies of scale ◦ lesser overhead cost

18. Financial Factors: Altman Z Score Snapshot of a company’s likelihood of filling bankruptcy Composite score encompassing 5 commonly used financial ratios Company’s that are in the 1.8 and under range are seen as extremely likely to file for bankruptcy Anything above 3.0 is considered unlikely for bankruptcy

19. Financial Factors: Altman Z Score Wendy’s current Altman Z Score is 7.85 Indicates Wendy’s is safe from bankruptcy at the current time Wendy’s creditor’s will view them as safe to loan to

20. Technical Factors New and up to date technologies have long time been the means of support of the quick-service restaurant Wendy’s has combined order-taking, order processing, and payment steps down to an effortless deed that only takes a matter of seconds.

21. Top Performers operational excellence like cutting costs, maintaining quality, and basically running a tight ship product innovation which refers to creating a flood of great new products. The information era, on the other hand, will require mastery of a third category of customer intimacy

22. Technical Factors The future generations of winners in the QSR business will be well-known for the most part by how well they know their customers and how they make the most of that knowledge to build customer preservation and loyalty. Wendy’s strategy takes structure along three steps: (1) collecting information, (2) turning information into knowledge and (3) turning knowledge into a customer relationship.

23. Technical Factors QSR companies will have the capability to know their customers in unmatched degrees of specificity. Instead of the wide-ranging demographic segments that companies now use for their marketing, technology will facilitate a pinpoint approach on a household-by- household, individual-by-individual basis.

24. Wendy’s Strategy Formulation Wendy’s is confined to a red ocean Therefore, in order for Wendy’s to continue forth, they must look to new ventures and ways of doing business that are consistent with their mission but also allow for further future growth

25. Business and Economic Characteristics Because Price and Convenience are near universal throughout firms in the industry, Wendy’s must focus on becoming the “highly favored” fast-food choice Doing so will give customers more inclination to visit store locations

26. Forces that Affect Competition The Economy caused businesses everywhere to focus on low cost to the customer; this presents a problem when every firm lowers prices The end result is that low price becomes the new standard so competition now lies in value Wendy’s has taken this road before during the inflationary period of the 1970s, with the slogan “Quality is Our Recipe”

27. Forces that Affect Competition The Super Size Me Documentary Caused a public backlash against fast-food restaurants In response to the 2004 film, Wendy’s introduced the Chicken Temptation® selections to their menu

28. Competing in the Industry Overall Wendy’s needs to stand by their strategy of creating a niche market by way of their side dish offerings. Expand competition base by being innovative and effective