Coffee Bean Management

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The porter’s five forces is a useful structure for competitive analysis within industry.

3.1 COMPETITIVE RIVALRY WITH INDUSTRY - HIGH

The Coffee Bean and Tea Leaf faces the strong force of competitive rivalry. The company faces large numbers of competitors in different strategies and specialty. It is also due to low switching cost which makes the customers easily shift to other brands available in Singapore.

Competitive forces like Starbucks, Rocky Master and other theme cafes are taking up a decent amount of The Coffee Bean and Tea Leaf customer by serving different menu choices and offer choices that are close to Asian culture.

3.2 THREAT OF NEW ENTRANTS - LOW

The threat of new entrants is rather low although the market is open for new entrants. They will need to have a huge capital investment to start with. But new entrants can compete against The Coffee Bean and Tea Leaf because of the moderate cost of doing business and supply chain development.

However, new entrants find it difficult to compete against established brand like The Coffee Bean and Tea Leaf as it is very costly to develop a strong brand. It is hard for the new entrant to meet and par with it in a brief time frame.

3.3 THREAT OF SUBSTITUTES PRODUCTS OR SERVICES – HIGH

As mentioned in 3.1, it is a very competitive industry The Coffee Bean and Tea Leaf is in, there are of course endless list of food and beverage products that customers can choose from.

The cost of shifting to substitute is low in light because the customers don’t have to spend for the moving procedures. In addition, a large number of these substitutes cost not as much as The Coffee Bean and Tea Leaf products.

3.4 BARGAINING POWER OF SUPPLIERS – LOW

Suppliers do not have much impact on The Coffee Bean and Tea Leaf. They have sufficient number of suppliers to choose from with low exchanging cost.

But the Coffee Bean and Tea Leaf practice fair trade and did not take advantage of their suppliers.

3.5 BARGAINING POWER OF CUSTOMERS – HIGH

Since there are no switching cost involved, the bargaining power of The Coffee Bean and Tea Leaf is high as there are many other coffee retailers to choose from.

Customers can also choose to stay away from The Coffee Bean and Tea Leaf if they want to because they can substitute with instant beverages and drinks from restaurants.

These strong factors overshadow the wat that individual buys are little compared to The Coffee Bean and Tea Leaf total incomes.

4.0 STRATEGIC RECOMMENDATIONS

These four strategic recommendations are based on what I believe the company could improvement on and be successful in the future.

4.1 RECOMMENDATION #1

As mentioned in point 2.4, technology is commonly used around the globe. It is highly recommended for The Coffee Bean and Tea Leaf to integrate with more technology to upgrade themselves and to be able to reach their consumers in many ways.

We are living in the era where everything is very high tech. Coffee Bean has a website to reach out to consumers.

Consumers can go to the website

REFERENCES

Coffee Bean (n.d) About us.

Retrieved from https://www.coffeebean.com.sg/about-us

Inside Retail (2015, February 25) New Coffee Bean Asia Chief.

Retrieved from https://insideretail.asia/2015/02/25/new-coffee-bean-asia-chief/

Trade Chakra (n.d) Political Risk in Singapore.

Retrieved from http://pestleanalysis.com/pestle-analysis-of-singapore/

Tang, S K. (2016, November 24) Singapore’s economy is slowing: What you need to know.

Retrieved from http://www.channelnewsasia.com/news/business/singapore-s-economy-is-slowing-what-you-need-to-know-7708744

Lim, A. (2016, July 12) The impact of digital transformation on Singapore’s workforce.

Retrieved from https://www.enterpriseinnovation.net/article/impact-digital-transformation-singapores-workforce-1436447968

Book Keeping Express (2016, June 9) A technology guide for coffee shops and café.

Retrieved from https://www.bookkeepingexpress.com/blog/2016/6/8/a-technology-guide-for-coffee-shops-and-cafes

Rinkesh. (n.d) What is Earth Hour?

Retrieved from http://www.conserve-energy-future.com/earth-hour-and-its-significance.php

McKewen, E. (2016, April 21) Challenges and trends facing food and beverage manufacturers

Retrieved from https://www.cmtc.com/blog/food-and-beverage-manufacturing-trends- and-challenges-2016