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Krispy Kreme’s External Evaluation
Designing a strategic plan for a business includes performing an external assessment to have knowledge of the market and its competitors. The external evaluation places emphasis on the opportunities and threats of an organization, and can have direct impact on their future logistics. According to David (2011), an external audit allows managers to formulate strategies to take advantage of the opportunities and avoid or reduce the impact of threats (pg.60). Ideally, an organization’s external assessment shows the direction in which the company is headed, and the tactical tools used along the way.
In executing an external assessment, an organization concentrates mainly on their competitors and market trends. Krispy Kreme’s leading competitors include the Starbucks Corporation and Dunkin Donuts. All three companies compete for market share prevalence in doughnuts, iced drinks, and coffee. However, the fight for the upper hand in market share is turbulent because Starbucks and Dunkin Donuts are foremost competitors in iced drinks and coffee, whereas Krispy Kreme and Dunkin donuts share their ascendant rivalry in doughnuts. Craver (2012) says, with Starbucks’ 11,000 U.S. stores, and Dunkin Donuts’ 7,000 stores, Krispy Kreme can’t compete with their coffee beverages in a major way. As a result, this leaves Krispy Kreme on the tail end of the coffee market share because of their recent introduction to the coffee arena.
A proficient way to measure the success factors of an organization and its competitors is by using the Competitive Profile matrix. The CPM identifies a firm’s major competitors and its particular strengths and weaknesses in relation to a sample firm’s strategic position, and can provide important internal strategic information (David, 2012, pg.81).
When businesses attempt to look in the future, they tend to recognize that continuing to move forward with the strategies that are at hand may not be adequate. With...
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