(Tiểu luận) midterm reportanalyzing corporate levelstrategy of golden gatecorporation

One year later, in 2009, the second branch of the Golden Gate was given birth with the name of Kichi Kichi under the model of a conveyor hot pot.After receiving positive feedbacks from t

FOREIGN TRADE UNIVERSITY

SCHOOL OF ECONOMICS AND INTERNATIONAL BUSINESS

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EVALUATION OF CONTRIBUTION FOR TEAM MEMBERS

Design Powerpoint slide and report

Golden Gate’s early stage strategySummarize referencesPresenter

Company’s overview

4 Phạm Tuấn Anh Golden Gate’s before pandemic strategy

5 Nguyễn Minh Hạnh Golden Gate’s during pandemic strategy

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6 Phạm Mai Phương Golden Gate’s post pandemic strategy

7 Lê Trần Thảo Ngân

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Base on the specific tasks listed above, our group has calculated the average scores for each team members as the following (unit of calculation: %)

Number of

Level of contribution (%)

TABLE OF CONTENTS

INTRODUCTION 5

CORPORATION’S OVERVIEW 6

GOLDEN GATE’S STRATEGY IN EARLY STAGE 8

1 Implemented Strategy 8

The portfolio strategy 8

The directional strategy 8

2 Strategy Evaluation 9

GOLDEN GATE’S STRATEGY BEFORE THE PANDEMIC 11

1 Implemented Strategy 11

Short term Strategy: Creating a new trend 11

Long term Strategy: Building a sustainable system 12

2 Strategy Evaluation 13

SWOT Analysis of Golden Gate before the pandemic 13

GOLDEN GATE’S STRATEGY DURING THE PANDEMIC 15

1 Implemented Strategy 15

2 Strategy evaluation 17

SWOT Analysis of Golden Gate during the pandemic 17

GOLDEN GATE’S STRATEGY AFTER THE PANDEMIC 20

1 Golden Gate’s current situation 20

2 Implemented Strategy: Invest in breadth and depth 21

3 Strategy Evaluation 22

RECOMMENDATIONS 24

REFERENCES 25

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In 2020, Golden Gate ranked fourth in the industry, accounting for 30% of Vietnam's food and beverage sales This company's chain restaurant is very common in Vietnam Especially “Kichi Kichi”, a sushi bar-type buffet restaurant These are restaurants that you can easily find when you eat out, such as club beer bar "Vuvuzela" and Korean meat restaurant

"Gogi House." Based on aggressive marketing and preoccupation with major commercial areas such as large shopping malls, this company has grown into the largest food service company brand in Vietnam All franchise restaurants were temporarily closed due to the government's strong quarantine system "social distancing" conducted by the company, which had no problems before COVID-19, and profits declined rapidly as fewer people ate out after that Let's look at what strategies companies that were doing well-applied step by step in the face of the pandemic of COVID-19 pandemic

This report analyzes the corporate strategy of Golden Gate since its inception, determines the type of corporate strategy selected by the company at each stage of corporate strategy analysis so far, and evaluates the risk and success/failure level of that strategy

CORPORATION’S OVERVIEW

1 History of establishment

Golden Gate (Golden Gate Trade Services JSC) was established in 2005 and is recognized as an operator of sales, restaurants, and franchise chains And it is a pioneer in applying the restaurant chain model in Vietnam, with five main casual dining cuisines which are Hotpot, BBQ, Asian, Western, and Cafeteria Golden Gate currently operates more than 22+ dietary concepts with 400 restaurants across Vietnam and serves 18 million customers each year

In 2005, Dao The Vinh, who lived in Russia for 14 years in his early 30s and returned

to Vietnam, opened the first mushroom hot pot restaurant Ashima on Phan Dinh Phung Street

in Hanoi with the help of a friend Ashima was more successful than expected, and the number

of Ashima restaurants increased to six in just two years

Vietnamese private equity firm Mekong Capital, which saw Ashima's rapid growth, invested $2.6 million in Hoang Thanh Joint Stock Company, which was renamed Golden gate

in 2017 Golden gate has made a major change with the support of investor Mekong Capital The venture fund introduced several restaurant concepts to help transform the golden gate into

a restaurant chain operator The founder is the chairman Mr Tran Viet Trung, the CEO Mr Dao The Vinh, and the deputy CEO, Mr Nguyen Xuan Tuong

Golden Gate’s growth highlighted in recent years

BÀI TẬP PHẦN XÁC SUẤT – AAA Class…

Giao dịch

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Mission: Happy team members - happy customer.

Philosophy: More quality of life

Vision: Be the first F&B choice

3 Corporation’s core values

Golden Gate’s core values are Integrity, Humanity, High performance

INTEGRITY – Doing the right things, even when no one is watching

HUMANITY – Acting out of compassion and empathy

HIGH PERFORMANCE – Being productive and strive for exceptional performance

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GOLDEN GATE’S STRATEGY IN EARLY STAGE

1 Implemented Strategy

Briefing about Golden Gate’s early stage corporate level strategy from 2008 until 2011,the firm had visualized a clear roadmap of the issues it must encounter as a whole corporation

The portfolio strategy

During its initial time of operating, Golden Gate has always been expanding extensively as well as intensively in the Vietnamese market, within the F&B industry only From the very start, they had put emphasis on the R&D process; accordingly, before launching

a new brand, this company conducted market research by two methods, orthodox and unorthodox With the orthodox method, the specialized department of Golden Gate will conduct research and estimate the market capacity Observing and feeling about the food, the decoration space, the way of serving are the unorthodox research methods After that, the R&D team will conduct research on new models, potential human resources to implement When the model is approved, the executive board, CEOs and related departments will discuss

in detail the specific implementation plan By strictly following this process, Golden Gate had successfully penetrated the Vietnamese market by understanding deeply about customer needs and desires, having stores located throughout the countries, initially Ha Noi and Ho Chi Minh cities - the major metropolis of Vietnam

Worth-mentioning, the corporation had the former CEO of the KFC restaurant chain in Asia to be the business advisor According to Mr Chad Ovel - General Director of Mekong Capital: “The key to Golden Gate's success is its access to experienced people in the world

We have created opportunities and conditions for Golden Gate's managers to go around, meet and interact with the world's leading experts in the restaurant industry, thereby helping them toopen new directions that are completely new to grow the company's business.”

The manner in which management coordinates activities & transfers resources and cultivates capabilities among product lines and business units

Typically, the senior managers will spend the week sitting with relevant managers in their respective fields “It could be half a day with the central kitchen manager, and half a day with the chief financial officer, and they could ask anything like how to create a bonus system

or negotiate with suppliers.”

According to Mr Ovel, such trips have brought Golden Gate's leaders to what is called

a "kick", which has completely changed the direction of the company's business

Along with the support of the fund's investors and their extensive network of relationships, Mekong Capital also introduced Golden Gate's management to the world's leading restaurant groups

The directional strategy

In the early stages of development, Golden Gate’ overall orientation was towards the Growth strategy, seeking to increase the organizational business by expansion into new products and new branches Within this strategy, Golden Gate had applied at the same time several strategies

- Horizontal Diversification

Horizontal Diversification refers to the development of new products that are somewhat related to the original lines This can be clearly seen from Golden Gate’s aim of opening new brands every year, but rather diversifying than serving customers the exact same products and services

Initially, in 2008, the company first launched with the Ashima mushroom hotpot branch One year later, in 2009, the second branch of the Golden Gate was given birth with the name

of Kichi Kichi under the model of a conveyor hot pot

After receiving positive feedbacks from the customers about the model of Kichi Kichi, in

2010, the Group continued to launch the third branch, which is Sumo BBQ, marking its diversified product range in the domestic market

- Both forward and backward vertical integration

Backward vertical integration is the attempt to gain control of inputs, becoming a self-supplier

In 2011, after three years of operation, with the aim to proactively supply itself with the qualified inputs to ensure the quality, time as well as the restaurant network, Golden Gate’s Board of Manager decided to investigate and complete the process of constructing new distribution center, with the scale includes the warehouse system, food processing and preservation factory in An Khanh Industrial cluster This allowed Golden Gate to have full control of its inputs, minimizing the costs for production and guaranteeing the quality.Forward vertical integration is the attempt to gain control of outputs through control of the distribution channel &/or provide customer service activities and eliminating intermediaries.Golden Gate has been its own distribution channels through its restaurant chains

2 Strategy Evaluation

Making its way into the F&B field when the market was only having KFC functioning under the mode of a restaurant chain However, it was about the fast food sector, and there hadnot yet existed any casual dining ones The model of Ashima natural mushroom hotpot brand had pioneered in paving the way for a new approach to the customers

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Financial stable after receiving the

investment of 2.6 million USD

from Mekong Capital

Uniqueness and novelty of the new

model of restaurant chain that

attracted customer’s attention and

curiosity

Fresh and guaranteed products that

is easy to serve and to preserve

Good market analysis to put right

emphasis on store decoration,

products and services favored by

customers

Weaknesses

Did not a clear vision and strategy but the brands are rather open naturally, following “trial and failure” up until receiving investment from Mekong Capital

Opportunities

The F&B market was still at the

initial stage of development,

giving Golden Gate the chance to

further penetrate the market

GOLDEN GATE’S STRATEGY BEFORE THE PANDEMIC

By the end of 2011, Golden Gate only owned 3 brands including Kichi Kichi, Ashima, and Sumo BBQ, and operated 35 restaurants with a revenue of 10 million USD From 2012 to

2019 marked the rapid development of Golden Gate when by the end of 2019, the company owned 20 brands, and 354 restaurants across the country and revenue exceeded 200 million USD (revenue increased 20 times compared to the time 8 years ago) This can be considered

as an overheated growth period for Golden Gate when the number of restaurants and revenue spikes year by year The reason for this success comes from 2 main business strategies: creating a new trend (short-term), building a sustainable system (long-term)

1 Implemented Strategy

Short term Strategy: Creating a new trend

One of the key strategies for the success of Golden Gate is the continuous pioneering

in creating new culinary trends for each distinct market segment New models such as Cowboy Jack's (American style restaurant), Osaka Ohsho (Japanese style) of Golden Gate have created "fever" among young people, even becoming favorite "check-in" points Along with delicious food, this company pays special attention to building a restaurant with a beautiful space to bring customers a variety of experiences

All brands of this group when launched are very focused on communication and marketing When a new brand is born, it always creates a hit, making a lot of excited customers come to try the experience for the first time And to do this, advertising alone is not enough, it is the conclusion of very deep and thorough market research For example, Vuvuzela, although the market at that time had a lot of beer restaurants, Golden Gate gave birth to the concept of a beer club, where people could drink beer and mingle at the same time.the vibrant music scene In the first few years of its launch, Vuvuzela opened whatever was popular, and any day of the week, finding a well-placed table in Vuvuzela – without a reservation would be impossible Vuvuzela is used to represent the fun, modern, and stylish concept of the 7x, 8x generation

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Although the appearance is different, but the 22 brands of Golden Gate are now 90% similar when built and operated on the same core platform with three pillars: people - process -technology 10% small difference comes from different culinary models Mr Dao The Vinh - founder and CEO of the restaurants group has the know-how and control processes so that each restaurant in the chain has the same quality.

For example, when Kichi Kichi appeared, immediately the model was copied, conveyor hot pot restaurants sprang up like mushrooms after rain in big cities But most of those restaurants were only crowded for the first few weeks, some lasted for no more than six months while Kichi Kichi continued to expand to localities “The restaurant business has a lot

of processes behind it, people only see the surface, copy the surface,” he said

Thanks to the unification of the process, diners see the same scene between Kichi Kichi, Manwah or Gogi House restaurants For example, when a customer has finished paying, the wait staff coordinate many stages smoothly: removing leftovers, cleaning the table,disinfecting, and arranging new dishes In less than two minutes, the new guests were seated with their a la carte menus “On the outside, customers find it interesting, but inside is a tightlyorganized process,” he explains

This service process has been formed over the years, drawn from reality and constantlyresearched and improved to permeate the company culture To keep pace, new employees are trained, there are cameras in place to control operations, there are internal control layers from restaurant managers, area managers and even “secret customers” – Insiders play the role of diners to evaluate the overall service attitude, food quality, layout, food hygiene and safety With two central kitchens located in Hanoi and Ho Chi Minh City, the strict control process helps Golden Gate to control the quality evenly at all restaurants except for the slight difference in food, mainly vegetables, depending on the main ingredients local or seasonal factors

Golden Gate's "process" is supported by technology In 2019, the company

transformed digitally through the introduction of The Golden Spoon application to replace the membership card In addition to restaurant location search, reservation, points accumulation,

payment, Golden Spoon asks customers to rate their satisfaction on a scale of 1-10 Digital transformation helps Golden Gate understand customers better to improve service quality.

2 Strategy Evaluation

SWOT Analysis of Golden Gate before the pandemic

Strengths

Having strong financial potential,

operating as a chain restaurant with a high

technical process

The human resources system is the leader

in the field of F&B in Vietnam

The employee training system can be the

leader in the restaurants present in

Vietnam, the employee's regime and skills

are always highly appreciated

Having the next event and developing

technology, taking the lead in technology

application to establish customers

Weaknesses

Most always play the role of a trendsetter, the market is not yet aware of and receptive to the products that the corporation offers

In the market at that time, peoplestill preferred fast food restaurants from abroad

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