Marci B Copeland

Cultural Environment Intl Business

Marketing 3852-001
June 21, 2015
Case Analysis Questions

Levendary Caf Questions:

1.
What is your evaluation of the way Levendary Caf has entered the China
market?

My evaluation of the way Levendary Caf entered the China market, is Chen
focused more on obtaining the highest amount of profit while sacrificing the image
of the Levendary franchise. Before entering the China market a detailed strategic
business plan to incorporate the established values from the Levendary brand with
the cultural differences in the multiple regions of China in which Levendary wishes
to expand. Since many of the regions may vary significantly within China,
management style, area food tastes, as well caf atmosphere must be reviewed. To
be successful, Levendary cant simple standardize the product, promotion, pricing,
and distribution of the franchise must adapt to the markets in China in which it will
be serving.

2.

What does it take to succeed in the restaurant franchising business?

To be successful in the restaurant franchising business, typically restaurant

appearance, food offerings, quality, service, ingredients, standards, values, and
management are very similar from one location to another. Customers visiting one
location know what to expect in all other locations they visit. Franchises will
incorporate food items that are local favorites, while still maintaining the basic
menu items that they are usually known for. However, when a business franchise
expands internationally, to succeed with the multi-cultural and diverse populations,
often changes must be made to other items that may be considered the franchise
standard. Different cultures have different beliefs in management styles. Cultures
can equate a price on a product as cheap or expensive, therefore price must be
reviewed carefully when entering a new market that has a different value system.
Expanding internationally, promotion must also be looked at carefully. A slogan may
not be automatically translated and maintain the same meaning in both languages.
Its important to realize the differences between being an individualism versus
collectivism culture as well as equality versus hierarchy, as well as change fearing
versus change embracing as well as how time is viewed in looking at Levendary

doing business in the US and the culture it will be serving by expanding

internationally into China and the major differences that may exist. All parts of the
marketing mix must be reviewed when expanding internationally.

3.
What changes (if any) should Mia Foster make? Specifically, what should she
do about Louis Chen? And what changes (if any) would you propose at
headquarters?

Changes that Mia Foster should make would be to work with Louis Chen in
creating a strategic plan for the expansion of Levendary Caf into the China market.
Mia should work with Louis to learn more about the regions Levendary has
expanded to why he made the decisions he made for each of the areas in which the
23 franchises are located. Mia should do her own research to find out what caf
atmosphere is welcome in each location, as well as the food taste of each location.
Also, Mia should determine, as noted above, the cultural differences between the
regions being served in China and the US culture. Mia should also look at food items
that may be considered offensive that are on the current menu, slogans used by the
business that will not translate well, and any other factors that may be against what
the culture values. Mia should research the expansion of similar quick casual
restaurants that have expanded into the different regions of the Chinese market and
what adaptations were required for the brand to be successful and review what
potential may need to be made for Levendary to be successful as it expands.
After reviewing all of the information, Mia should incorporate changes at
corporate headquarters that will include taking into account international expansion
and the need for adaption into other cultures. This may include changes to
management style, caf atmosphere, pricing, promotion, caf offerings, caf
location as well as all factors to allow the franchise to succeed internationally. The
organizational structure should change in all areas, including concept, marketing,
food, operations, business development and administrative staff groups. This
change would include the creation of an international division with a representative
from each of these groups. These areas should begin to include partnerships with
individuals and companies in China to incorporate the current tastes and items
acceptable in the regions it has already expanded into and the areas it plans to
expand into. These partnerships can help with negotiations to create a finished
organizational structure that will incorporate US culture and China culture to allow
for success in both countries. The current structure is focused entirely on US
operations, to allow expansion, the focus must change. Partnerships with
individuals and businesses within China should be created. These partnerships can
help in the proper setup and expansion of the Levendary Caf franchise. Overall,
the vision must change at headquarters to include an international look at adapting
to its surroundings for caf atmosphere, caf food offerings, and management style,
but still maintain quality, as well as the Levendary Brand.

4.
Prepare a specific action program for Foster to help her deal with the need for
continued growth in China? What should be on the agenda for her meeting with
Chen?

The action plan that Mia should incorporate to allow for continued growth is
to start forming relationships with individuals and businesses in the regions in which
Levendary plans to grow and the newly established international division. Mia will
create an international division with a China location with representatives from
concept, marketing, food, operations, and business development. These individuals
should have a close working relationship with headquarters as well as Louis Chen.
Louis will submit a strategic plan that will include information to support the
strategic plan for new locations. All approvals should go through the entire
international division for all decisions for a new location. Existing locations will be
reviewed and revamped according to the international division and input from the
formed partnerships based on local adaptions as well as maintaining the quality and
brand of Levendary. No longer will decisions be made by one individual. Decisions
including menu, location, food offerings, management, promotion, pricing, etc. will
be made at the international division level. Since input will be from all areas and
including individuals familiar with the local culture and values, Levendary will have
a greater chance of success as an international business while maintaining the
integrity it has built in the US at all levels including political, economic, social, etc.
Also, a set implementation schedule will be created by the international division to
ensure proper test marketing, research, and background has been completed prior
to starting the creation of a new location. Creating a more structured
implementation for expanding into China will allow Levendary to maintain its quality
and brand but adapting to the local culture as needed while meeting established
profit levels by properly implementing and not short cutting the expansion of the
Levendary franchise into China.
On the agenda will be a reminder of what the Levendary brand stands for and
how this brand will adapt to the regions it goes into in China, the brand itself will not
be compromised. Mia will request Chen provide research and market testing for the
locations that he has already setup. Mia also will request an analysis of the regions
that Chen is expecting to expand into to assist Louis with the creation of a standard
strategic plan for these areas. Mia will inform Chen he will need to provide a
strategic plan for each franchise current and future before proceeding with
additional locations. This strategic plan will be reviewed by the newly formed
international division to determine viability and support of the plan. If the plan is
not supported, Chen will need to review the recommendations of the international
division and make appropriate changes before proceeding. Chen will be required to
submit a strategic plan of the current locations that including the basis of the
decisions made for those locations. Chen will present this to the international
division for review and proposal of what needs to be changed to adhere to the
quality and brand of Levendary. Mias agenda will include providing Chen with an
organizational chart of the international division and the proper flow of approvals for

the Levendary expansion into China. Mia will request Chen to attempt to setup
meeting with local Chinese business owners and individuals to allow for
collaboration as the brand expands. When meeting with Chen, Mia will emphasize
that all international and US laws and regulations must be adhered to even if it
causes delays that may impact profit. Mia will also include on the agenda, what
Levendary expects as it expands into China and Chens responsibility in that
expansion.