Ruth’s Chris: The High Stakes Of Internationalexpansion Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Ruth’s Chris: The High Stakes Of Internationalexpansion Case Study Help

. The diversification model is also neglected by the restaurant, which is an essential factor to have a substantial growth into new markets. Dan new that the current dining streak model will prove to be useful if implemented in new markets as well.
3. The third business model is penetration, whichindicates to opening more restaurants franchises in the same market. This model is already being implemented in Canada with the opening of the chain’s new restaurant.
4. The fourth model is the market development model, which encourages the inauguration of more restaurants in new markets and it is the most obvious model to increase the revenues. The restaurant has four franchises in Canada, Taiwan, Mexico, and Hong Kong, which are very profitable and can add more value if further franchises are established.

The current business model which Ruth Chris is using is that it is introducing new food items in its menu, which includes: lamb chops, veal chops, fish, chicken, lobster and vegetable platter. It is also using various strategies to generate more profit by satisfying its customers and having a high quality raw material. Although, the restaurant business is in a better position; the above mentioned models are recommended for its further growth.

b) Recommend two countries that are best suited to Ruth’s Chris expansion using each element of Porter’s determinants of national advantage.

Porter’s determinants of national advantage	China	India
1. Firm strategy, structure, and Rivalry	v Operating in China is suitable because of the growth strategy. v Fewer competitors.	v India is also suitable as there are more seafood requirements. v Due to the high population; there are more chances of generating profit.
2.Factor conditions	v Labor availability is an opportunity for the business’s growth. v Natural resources like land and agricultural availability.	v There is anavailability of land for agricultural and farming activities. v The Arabian Sea will also contribute tothe seafood requirement being fulfilled.
3.Demand conditions	v The purchasing power of Chinese as well as their seafood demand,can serve as a better growth option.	v Although the purchasing power of Indians is less, they demand spicy food, including seafood.
4.Related and supportive industries	v Online service providers are available in China, which can help the restaurant to grow and provide its customers with facilities of having the restaurants ‘food in the comfort of their home.	v Suppliers are crucial for innovation through high quality. v Suppliers are highly available in India.

c) Briefly describe how consumer animosity might (or might not) affect your selection in b) above?

Consumer animosity can effect in India, as the restaurant’s specialty is steak. Indian culture discourages beef items, because of their norms and values. In China, there are chances of consumer animosity as the company is the US based, and the relations and economic conditions are not stable.

Question 4.

Another senior member of the business development staff suggests that, rather than importing Australian beef to use in countries that don’t accept U.S. beef imports, Ruth’s Chris should just re-label the USDA beef as Australian beef and use it in any overseas locations that do not accept U.S. beef imports. The member believes that this is O.K. to do because it saves the company the time and expense of procuring and shipping the Australian beef, it opens more options for international expansion and, “we know that the U.S. beef is safe anyways.”

a) What is the ethical dilemma and possible unethical behavior in this suggestion? Why do you believe this to be so?

As Ruth Chris is a steak house and its customers enjoy beef; its annual consumption of beef is very high. The restaurant uses only USAD prime beef, so it has to be exportable to the target market. But in some of the cases; Australian beef also meets the US beef standards. There are some countries who don’t accept the US beef; some seniors suggested that the removal of USAD label and re-labeling the beef as Australian is an unethical practice. Although it is an additional cost for the company to transport beef from Australia, but presenting something as an entirely different thing, is said to be an unethical act. The countries who don’t accept USAD beef must have their own reasons so they should not be fooled into having the US beef as Australian beef. However, the US beef is also safe to be consumed but the countries have their own specific reason of choice in not having the consumption of beef from the US.

b) Analyze the case in terms of the major factors affecting ethical or unethical behavior. Based on this analysis, do you believe that Dan Hannah would entertain and/or agree to this suggestion? Why or why not?

The major factors affecting the unethical behavior are high cost of shipping from Australia and wastage of time in the beef’s delivery. Although, these are the major factors, but Hannah would not entertain this suggestions as he knows that it will create a problem, because of which the reputation that Ruth Chris has built, can be massively damaged.

c) Finally, what corporate governance actions should the company take to improve/ensure appropriate ethical behavior of its employees?

The company should train its employees as well as the management in the cultural and norms of other countries. As every country has some cultures and sub- cultures, which everyone should respect. If a country does not accept something, it her own choice no one should be that much selfish to benefit their selves by hurting others and no one can force nor cheat that country’s culture, norms or values.

Question 4.

a) Describe the industry life cycle stage that you believe Ruth’s Chris is operating in both domestically and internationally and why you believe this?

The industry life cycle includes four stages:introduction, growth, maturity, and decline. According to which, the company is at the second stage that isof growth in both domestic as well as international markets. The company is at the growth stage as it did not only enjoy milestone in 2005 but also generated revenues of more than $154 million. In 2005, the sales were $415.8 million from 82 of the US regions and 10 international locations. This shows a substantial growth of the company.

b) Given the industry life cycle stage and considering our reading on this subject, briefly discuss three reasons for Ruth’s Chris to pursue an international strategic alliance.

As an international strategic alliance is a collaborative agreement between firms; it includes multiple dimensions. In Ruth Chris’s case; it can be franchising, marketing and other activities. The company should pursue an international strategic alliance for having an international growth with diversification, domestic growth with product development, and further growth in the same market, in order to broaden its customer base throughout the world.

c) Given Ruth’s Chris’s objective of international growth, what type of cooperative strategy do you recommend and why? Finally, based on our readings, discuss one major risk to your recommendation and two problems that Ruth’s Chris might encounter in attempting to end the alliance

For an expansion purpose; the company should focus on its product development, which would create an opportunity for the company to grow not just in the existing markets but in the new markets as well. It is more profitable if would-be franchises offer better services to satisfy their customers.
The major risk of this strategy could be the limiting the product line by using the same products for the new markets. Without any change in its products; the company would be more likely to have lower growth in its sales, because the customers tend to get bored of the same variety of dishes being offered in the menu if there aren’t any modification in the menu after a regular interval of time.
The main problems with this recommendation are the sales growth in the existing markets. New products attract the customers, but if the customers keep experiencing the same product for a longer period of time, then it is an obvious fact that they will get bored of the same type of products being offered and would long for a change or diversification. Moreover, the company as well as its products need to grow in the international markets, because this strategy can limit the chances of having international profitability.

Question 6

Briefly present one international level strategy and one business level strategy that would apply real options reasoning to the Ruth’s Chris international expansion decision. Based on our readings, what type of real option(s) would be used and why?

The international level strategy should be diversification, which will result in new product development in the new market. Ruth Chris should use this strategy, as every country has its own choices; so the company can make the customers from different countries satisfied by offering them the kinds of services that they want. The real option for Ruth Chris’s international expansion is the diversity of its products by introducing a new menu, which includes: steaks, seafood and other main courses of consumer’s choice.......................................

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