Founded in 1969 in Dublin, Ohio, by Dave Thomas, Wendy’s International has grown to be one of the leading companies in the restaurant industry. As of the year 2003, Wendy’s has over 8,000 restaurants worldwide, including more than 3,500 Tim Hortons and 800 Baja Fresh restaurants, which are two companies that Wendy’s owns (Milton, 2003, p. 1). Currently Wendy’s is the third largest fast food chain in the world behind only McDonalds and Burger King (“Industry Surveys,” 2003, p. 8). This is an interesting company to look at because of the respectable growth Wendy’s has attained while other leading restaurants have faltered. Wendy’s has been able capture market share from historically invincible rivals through better service and a higher quality product. A concern that would keep Wendy’s CEO up at night is if Wendy’s will be able to continue to be innovative and outperform rivals, or will Wendy’s fall victim to the problems that face their competitors from growing to big and losing a sense of consumer demand. The main issue to look at is if Wendy’s can take advantage of McDonald’s and Burger King’s recent troubles in or

The threat of new entrants is an issue that large firms cannot ignore. Entry barriers into the industry are quite low, which explains why small operators run seven out of every 10 restaurants in the industry (“Industry Surveys, 2003, p. 14). There is also high potential for rewards if these small restaurants are able to succeed. Both of these facts can be considered threats to large established companies. A few opportunities associated with potential entrants is that established firms can take advantage of economies of scale in production, access to distribution channels, and large amounts of capital to launch massive advertising campaigns. Substitute products can also pose a threat to restaurants like Wendy’s and McDonald’s. There are many alternatives to eating at fast food restaurants such as cooking at home, going to a full service restaurant, or even ordering pizza. Luckily for fast food restaurants, a big opportunity is their ability to quickly feed and satisfy customers who increasingly seem busier and need to eat on the run. Finally, the last force from Porter is the rivalry among competitors. An opportunity is that Wendy’s is one of the largest restaurants in the world and can competitively compete with anyone. A threat comes from McDonalds, which is the largest restaurant chain in the world, because they have the money and power to remain the leading restaurant in the industry for many years to come.

A strength in Wendy’s manufacturing is that their food is known for its freshness and quality. This quality of food it said to be one of the main reasons why Wendy’s has outpaced the annual sales gain of McDonald’s from 1998 to 2002 (“Industry Surveys,” 2003, p. 3). Their market share also rose from 10.3% in 2000 to 11.4% in 2002 (“Industry Surveys,” 2003, p. 3). A manufacturing weakness could be that it will be difficult for Wendy’s to make dramatic improvements in this area in the future.

The environment of an industry can be effectively analyzed using Porter’s five forces model that include: power of suppliers, power of buyers, threat of new entrants, threat of substitute products, and rivalry among competing firms. The suppliers in the restaurant industry, such as meat and equipment suppliers, have little power because there are numerous throughout the world that firms can chose who to buy from, so this would be considered an opportunity for restaurants. A threat involved with the power of suppliers is that suppliers can fairly easily integrate forward into the restaurant industry and become a rival. Additionally, the power of the buyers is somewhat weak, which is an opportunity to the industry. The firms in the industry have millions customers throughout the world. Even though there are many buyers in the market, if the demand of a large number of these buyers collectively changes, then this could be a considerable threat to restaurants because they may be forced to change their current strategies to something that appeals to this new demand.

Wendy’s primary competitor in the fast food industry is McDonalds because the company’s market power and size. For many years, McDonald’s strategy to continuously grow has made it the most powerful restaurant in the world, but the strategy has started to backfire. In the past few years, Wendy’s has managed to gain marke

Some topics in this essay:
Department Agriculture, Competitor Environment, McDonald’s Corporation, International Inc, Wendy’s McDonald’s, External Environment, Wendy’s International, Human Resource, Dave Thomas, Burger King, fast food, fast food restaurants, food restaurants, restaurant industry, wendy’s company, 2003 1, “industry surveys”, “industry surveys” 2003, wendy’s international, surveys” 2003, fast food industry, food industry, restaurant world, fast food restaurant, surveys” 2003 9,