Disney Case Study

Analyzing A Case Study: Ruth’s Chris

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Situation Analysis

The phrase Ruth`s Chris steak house is synonymous with a tasty mouth watering steak. Ruth`s Criss company founded way back in 1976 by its owner Ruth Fertel is worth several millions of dollars. The company`s vice president Hannah, plans for a major expansion in the ranchise base, this time round on the international level. The company does not have any problems in as far as its products and customer service is concerned. However, the company is experiencing serious problems in that it cannot decide the best way forward to expand Ruth`s Chris business to the next level. Presently, the company has a total of 93 restaurants, among them 42 are owned by the company, while the balance of 51 are franchises. The company has restaurants in various countries including; Hong Kong, Mexico, the United States and Taiwan.

The business was so popular, to the extent that many franchisees were willing to open the business in their respective locations. However, the strict conditions put forward by Ruth`s Chris ruled them out. Among the conditions were: the franchisee had to have a cash float of $ I million, the franchisee had to possess tangible experience working in the hospitality industry, the franchisee had to posses both the willingness and the desire to set up Ruth`s Criss in several locations (Kupetz and Alon 2006). The investors were further scared off by royalty charges of five percent on the total gross sales and two percent of the total gross sales to be contributed towards national advertising initiative. The company faces new challenges arising from the 2005 initial public offering. The company raised a total of $ 154 million in fresh equity. Given its entry in the stock market it had to meet the expectations and requirements of Wall Street in terms of revenue growth.

On the positive side, the company has registered a steady growth in its revenue. However, from the market...