Papa John’s Company is an international pizza delivery company whose headquarters are located within Louisville which is a major city in Kentucky. John Scatter started it as a small business where he sold pizza in 1984. Under his leadership as the CEO of the company, PZZA has become the fourth largest pizza company in USA besides Domino Pizza, Pizza Hut and Caesar’s Pizza. It has been transformed from a singly owned business into an international business which covers about 35 countries across the world. It operates about 4200 restaurants which are franchised in USA as well as the 35 countries across the world (Grant 256).
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Market Description and Share
PZZA Company targets international and local market where the local market comprises of 50 states in USA while international market covers about 35 countries across the world. The company obtains its market by using a franchising system which has about 4200 franchised restaurants in USA and other countries (Cavender 132).
Seven hundred of these restaurants are owned by the company while 3500 are franchised purely to other entities. For international markets, the company delivers through dine-in based systems which ease the process of serving customers.
The company shares the market with other competitive companies which include Domino Pizza, Pizza Hut, and Caesar’s Pizza among other companies. Despite the competition, the company is able to cover all the 50 states in USA. However, the company is more popular in Kentucky than any other state in the United States of America.
Leadership of the Company
The chief executive officer who is also the founder and spokesman of the company is referred to as John Schnatter. After completing high school education in Jeffersonville school, John joined the university of Ball State where he attained a business degree in 1983. Immediately after completing higher education, he sold his Chevrolet car and purchased pizza equipments for $1600 to start the pizza business in 1984.
This was an immediate move considering that he had left from college freshly, yet he wanted to apply his theoretical knowledge in real life. He has been a key player in University of Louisville where he supports the development of Papa John’s Cardinal Stadium which is the home of university football program.
The company announced Caroline Oyler as the vice presidents in charge of the company’s legal matters in 2012. She takes care of the intellectual property, franchising, and international law following her competence in legal issues. She has served the company for the last thirteen years where she headed various departments including human resource department.
This has equipped her with the necessary experience to lead as vice president of the company. Besides working for PZZA Company, she has worked for the Wyatt Company where she served as senior lawyer, advised clients concerning employment, and litigated cases on federal laws in USA.
Secondly, the company is led by Bob Kraut who serves as the vice president in charge of marketing department. He joined the company recently after working for Arby’s company which is a reputable and prestigious restaurant in USA. This service has helped Bob to gain enough experience enabling him to serve as the head of marketing in this company.
Potter’s Five Forces of Competition
Pizza delivery and sale is a prestigious business opportunity that has attracted profound interest. Although PZZA is established successfully in Kentucky, there are some upcoming companies that are exploring this field. For example, Newport Pizza Company is a new company which was introduced in 2012. The entry of these new companies leads to increase in competition and possible reduction of the original profits that PZZA Company got from the market.
The company is the fourth largest pizza company in USA implying that there are three larger companies than PZZA. These companies include Domino Pizza, Pizza Hut and Caesar’s Pizza. They launch a lot of competition to PZZA Company leading to sharing of market and profit.
The company has profound market which includes international customers and local ones. This market has resulted to the progress on the company due to constant flow of profits from local and international profits.
Supplements and Complements
The company is affected negatively by the availability of substitutes whose production is based on the health and nutritional values. In fact, they are referred to as healthy alternatives to the pizza. The producers claim that the alternatives have little calorie content to avoid cancer and high blood pressure (Weil 123). This is a big blow to Papa John’s Pizza Company. For example, hummus is a healthy and nutritious alternative to pizza which is made from chickpeas.
Regarding the complements, there are various foods taken along with pizzas such as beer. In fact, most people take beer along with pizza since they are regarded as casual foods. This increases the consumption of pizza and boosts the PZZA Company. The complement attempts to balance and neutralize the effect of substitutes in the market.
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The company has competent leadership as well as a holistic leadership structure which include the CEO, president and vice presidents among other employees. The current personnel are well equipped with academic knowledge and experience which helps the company to progress financially.
Additionally, some of these leaders have served in the company for a long period of time leading to loyalty. Second, the company is ranked highly in USA since it is the fourth in hierarchy implying that many people prefer it for its prestige. Lastly, the company has a wide market including international and local market which covers USA and 35 other countries.
The company has not diversified its business since it dwells with a single product rather than incorporating more products. Lack of diversification allows substitutes to take over the pizza and reduce the company’s profits. In addition, the company has not considered the healthiness of pizzas to the public implying that other entities might eliminate pizzas on basis of health and fitness.
The company has a good and expansive reputation in the local and international market since it has created a strong brand. This brand is an essential opportunity since the company can include other products in the business without incurring much resistance. Additionally, the company has a first mover advantage which could be used to compete against new entrants.
The key threat is the rising demands for healthy and safe foods due to the prevalence of lifestyle diseases such as high blood pressure and diabetes. This is a potential threat that can reduce the consumption of pizzas.
Open System Analysis
Since the company manufactures product, the inputs of the company include the cooking equipments and raw cooking materials. The equipments include ovens while raw coking materials include wheat flour, vegetables and others. The through-put-processes aim at changing the raw material into edible pizzas by cooking, grading and packing pizzas.
The main output produced is the edible pizzas which are delivered to the market through franchise systems. These three processes of the open system are conducted in the same company premises.
Value Chain Analysis
The primary functions of PZZA Company include the customer relationship management and supply chain management. These involve the actual production and delivery of pizza to make profits in the company. All the efforts that are portrayed in the company aim at executing these two functions.
Support functions that aim at reinforcing the primary functions are included in the following list.
- Dealing with legal issues
- Creating brand and rebranding
- Making patents and relevant copyrights
- Creating a good picture to the community by donating funds among others.
All these functions aim at coordinating all the arms of the company and ensuring that they work in a coordinated manner.
Recommendations of Goals
Previously, it was evident that the company is ranked in the third position. In this light, one of the most crucial strategic goals of PZZA Company is becoming the main delivery chain of pizzas in the USA. It must, therefore, aim at increasing its financial competence and profits.
Regarding the tactical goals, the company should aim at diversifying their products rather than pizza only. This implies that the company should also concentrate on the supplements and complements of pizzas in order to maintain their market. Additionally, the company should aim at producing health-oriented pizzas to avoid market loss.
Lastly, the company’s operational goal should aim at building a larger network which covers more than 35 countries across the world. This will be achieved by increasing the marketing operations through the respective department.
Cavender, Chris. A pizza to die for. New York: Kensington Books, 2011. Print.
Grant, Tina. International directory of company histories. Chicago: St. James Press, 2007. Print.
Weil, Andrew. Eating well for optimum health: the essential guide to food, diet, and nutrition. New York: Knopf, 2000. Print.