Hard Rock Cafe Vietnam Expansion Opportunities And Threats Tourism Essay Example

Hard Rock Cafe Vietnam Expansion Opportunities And Threats Tourism Essay Example Hard Rock Cafe Vietnam Expansion Opportunities And Threats Tourism Paper Hard Rock Cafe Vietnam Expansion Opportunities And Threats Tourism Paper The name Hard Rock Cafe is self-contained plenty to do clients believe of an arousing atmostphere where emphasiss and force per unit areas from everyday life give in to entire relaxation and refreshness. Hard Rock, being welknown for its unforgetable dining experiences, possesses the most valuable music memorabilia aggregation in the universe that worth up to US $ 40 million ( Hard Rock Cafe International, 2009 ) . Together with its growing, Hard Rock has brought the spirit of Rock-n-Roll to more than 52 states, doing the Cafe among the most accepted trade names internationally. Not limited to the music aggregation, Hard Rock coffeehouse besides takes pride in its superb culinary art, comprehensive human resource direction and strategic places. In order to detect how the Cafe can execute so good in the market, closer expression should be given to Hard Rock s operation schemes. Originated in England, but the land where Hard Rock is at its premier and sets the requirement for its trade name to travel international was the United State of America. In England Hard Rock has merely two coffeehouses in London and Manchester severally. No Hard Rock hotel or casino is located at that place. Whereas, the figure of Hard Rock sites in America is impressive with 45 coffeehouses, 7 hotels and 3 unrecorded concert scattering all over the states. This underpinned a brilliant alteration in Hard Rock s location scheme ( Hard Rock Cafe International, 2009 ) . : Harmonizing to Heizer A ; Render ( 2008 ) , before gap in a specific country, Hard Rock directors ever conduct a thorough research in order to come up with a elaborate and comprehensive study refering whether the topographic point is suited. The study include a figure of factors that are demographics, visitant market, transit, eating houses, etc and each factor is weighted carefully in order to give a big image of the planned environment for Hard Rock. Even though a research is non easy to carry on, it is truly good to Hard Rock in tem of hazard cut downing and growing prospect. Rather than blind investing, a Hard Rock can utilize the informations gathered to derive entree to a sufficient base of clients and guarantee that the Cafe s operation does non conflict the authorities s ordinances. Concentrating on the enormous revival of metropolis centres where nightlife tends to concentrate is besides a sensible pick of location for the Cafe as life styles in those metropoliss are qui te dynamic and people tend to pass more on amusement. With a long term determination for location, at least 10 to 15 old ages, the break-even analysis is applied by Hard Rock to see when the coffeehouse s net incomes can cover all of its land and building cost. Hard Rock s determinations appear to be conflicting since resurgent metropoliss ever accomplices some degree of instability. Therefore, the apparently safe determination of perpetrating at least 10-to15 old ages in those metropoliss turns out to be unsure. However, it has to acknowledge that Hard Rock neer disappointed its clients. Whenever shuting a underperforming coffeehouse, clients can ever trust to see another one gap nearby shortly, and in a more ideal topographic point. Puting into the context that Hard Rock s chief clients are tourers, location and convenience become highly important. Hard Rock cafe New York from 57th Street, as an illustration, has been relocated to the amusement and tourer topographic point of the universe, Times Square ( Hard Rock Cafe International, Inc. 2005 ) . What amazing is while the former officially closed its doors on August 11, 2005 the latter came unfastened right on August 12 the same twelvemonth. Hard Rock s campaign for location seem to be indefatigable since whenever any of its cafe stopping points for hapless public presentation ( such as in Caracas, Venezuela ) , it can instantly happen its new lands ( like in Gran Canarias, Belo Horizonte and Mumbai ) . However, with such a planetary enlar gement, Hard Rock should take prudent stairss to avoid unexpected impacts ( such as natural catastrophes, recoup or tabu ) . Hard Rock might happen franchising a safe solution to do its gateway to a new society every bit good as to minimise attach toing hazards that result from strangeness or finance limitation. Franchise, hence, might offer a solution ( Hard Rock Cafe International ) . ( Refer to appendix 1 for the pros and cons of franchising ) Human resources: Since employees are those who interact with clients the most, they represent Hard Rock to convey to the clients different experiences. Hard Rock has adopted a comparatively comprehensive HR scheme in order to hike the Cafe s productiveness and efficiency. Hard Rock s HR direction procedure Harmonizing to Acas ( 2010 ) , enrolling incorrect people for the organisation can take to many jobs including increased labour turnover, increased costs for the administration, and lowering of morale in the bing work force as those people barely have committedness and passion for the occupations. Therefore, enlisting should be given extra-attention which might be cost and clip consuming at first, but can cut down the incommodiousnesss in future clip. Hard Rock normally does nt curtail its enlisting pool since the the Cafe wants to hold diversifying employees in order to enrich its on the job civilization. This is besides a really wise determination because the wider the scope of appliers, the more likely Hard Rock can take the most gifted for the occupations. However, as together with the company s growing, staffing direction becomes an obstruction that Hard Rock has to manage. While direction staffing is tackled in corporate degree, the duty to staffing hourly employees is claimed by the general director at each coffeehouse. This lead to the stacking up of plants for coffeehouse s directors who are already occupied with affairs such as gross revenues and finance. The multi-recruitment tool CKR interactive has offered a solution by developing a comprehensive hourly enlisting selling plan. This plan begins with the research on employees civilization, whose consequences will give the base for edifice and advertisement runs to pull appliers. This plan is really utile since it provides the general director with a assortment of solutions, composing of advertisements, internet posters, and cyberspace streamer advertisement and even in-store postings to enroll invitees in the coffeehouse. With the Love all, serve all motivation, Hard Rock selects employees who are knowlegable and fond of music, every bit good as good at interpersonal accomplishments. Enrolling the right people for the right places, furthermore, saves money for the procedure of hiring and preparat ion in the long term as employees are more likely to experience satisfied with their occupations, know what are expected from them, and remain on occupation longer. After enlisting, preparation is besides really important because in this phase, employees are given practical cognition on what they are required to make. Normally, employees in Hard Rock have to go to a two-day preparation ( Heizer A ; Render 2008 ) . This preparation aims to familiarise the employees with the bill of fare content and the table countries so that they can take the order right and avoid staff congestions. The 2 twenty-four hours preparation, though really effectual in bettering employee s productiveness, is non plenty to keep their public presentation, particularly when Hard Rock commits to custom-make their services. On-job preparation plan should be given so that employees can interchange their thoughts and accomplishments, heightening non merely the productiveness of single employee but besides the whole staffs. Official developing class should besides be given on yearly-basis to bing employees to further their public presentation every bit good as to roll up feed back to following twelvemonth preparation, maintaining the employee on path of clients demands and functioning attitudes. Employees, after being recruited, must be motivated on a regular basis so that they have the inner driver to accomplish better consequences. Hard Rock starts with an effectual working agenda, giving employees productive working displacement with ranking of single importance for each displacement. The consequence of this flexible agenda is employees non merely can mentally but besides physically fix for their work, maximising their productiveness. Furthermore, waiter-gratuities petition of 5 % of the entire measure is imprinted in the coffeehouse s bill of fare is among the direct incentive for employees to work hard as the more people they serve, the more money they will acquire. Nonetheless, pecuniary incentive sometimes does nt hold the long-run consequence since employees ever have their bound. Non-monetary award becomes progressively critical in maintaining employees every bit good as in raising employee s committedness. In Hard Rock, directors can be promoted through hourly emp loyee ballots, giving the director the motivation to neer self-content with their current occupations. Outstanding employees of the old ages are besides a plan to raise employees self-pride, raising employee s moralss and enthusiasm for their work. Employees working for Hard Rock more than 10 old ages are besides awarded with a $ 10,000-worth Rolex, a ground for them to remain longer in the company ( Knight, 1999 ) . Apart from really good rewarding policy, people working for Hard Rock besides have the chance to partake societal activities in many voluntary plans. They can truly let go of their occupation force per unit area to recognize that their milieus are non restricted to the eating house but are extended to a larger community. At the same clip, societal activities can heighten employees ethical criterions that are necessary to make an ethical working environment. By actuating in both pecuniary and non-monetary term, Hard Rock is a preferable employer for many people and ben efit from low turnover rate. Nonetheless, motive should be just and on right people. Hard Rock has to guarantee that every employee have to opportunity to make their best and their attempts are recognized by their directors. For illustration, the same employee will non be scheduled in a fixed displacement during the hebdomad since he might either acquire excessively dog-tired due to work overload or have low tip. To cognize whether the motive and wagess are for the right employees, rating will make up ones mind. Normally Hard Rock uses employees vote for public presentation assessment. Gross saless are besides a method to cipher employee s productivenesss. However, these two types of rating are subjected to many variables such as employees realationships or the tourer industry s wellness, which barely delivers accurate information. It s extremely recommended that Hard Rock follow new assessment measurings that depict employees public presentation objectively. The 360o feedback, observation, interview or mysterious invitee will back up Hard Rock Cafe s directors in right measuring their single employees ( appendix 2 ) . Quality: Quality is besides a major portion of operation direction scheme in Hard Rock. Hard Rock chooses its stuff from qualified providers. For case, beef supply for Hard Rock Cafe s Burger bill of fare is the land Certified Augus Beef, a celebrated trade name in America ( Certified Augus Beef ) . More than that, Hard Rock develops a thorough nutrient quality look intoing system to guarantee the consistence of the nutrient s criterions. Understanding that stock list direction straight affects the quality of the merchandises, Hard Rock coffeehouse chooses the FIFO ( first-in, first-out ) for perishable stock list so that to cut down the storage clip of nutrients and drink while keep the consistent quality for every repast served ( Reed, 2008 ) . Harmonizing to Heizer A ; Render 2008, repasts in the Cafe are ranked with the highest degree of 7 and if the ranking is below 7, the merchandise is failed. This stiff demand encourages both directors and employees to ever take high and neer lose at tending to the merchandises quality. By delegating excess people to duplicate cheque every dish in the kitchen before directing to the clients, Hard Rock besides makes certain that repasts are met with the rigorous criterions set. Opportunities and menaces for Hard Rock s enlargement to Vietnam: Location Refering the enlargement of Hard Rock Cafe to Vietnam, there are certain advantages. Harmonizing to Hodgson ( 2007 ) , the state s developing touristry with about 3.6 million tourer reachings per twelvemonth is predicted to rank among the top 10 tourer finishs by 2016. In the hereafter, furthermore, a new F1 racing bowl was permitted by the authorities to be built in Khanh Hoa state. This bowl is expected to be built within 3 old ages with the estimated building fee of USD150 million. The bowl will be the largest 1 in Southeast Asia that can pull about 600 million people per hebdomad. This information proves that Vietnam is traveling to be a moneymaking finish for Hard Rock.A However, with the uninterrupted gobal economic crisis in recent old ages, touristry in Vietnam has witnessed a important downswing that is improbable to retrieve in affair of yearss. If Hard Rock invests in Vietnam at this point of clip, it has to be prepared with a strong finance so that Hard Rock can feed up i tself before truly doing net incomes. Until December 17, 2010, Hard Rock Ho Chi Minh has been runing for precisely one twelvemonth. Its location is Kumbo Asiana place, 39 Le Duan, District 1, the centre of Ho Chi Minh metropoliss where people are dumbly inhabited. This was a franchised coffeehouse owned by Viet Thai Group, a corporation that was celebrated for its High Land Coffee concatenation ( Thien, 2010 ) . While High Land Coffee aims at mass market, Hard Rock dressed ores on supplying service for upper category people. Mr. Thai Viet, general manager, said that securing franchise of Hard Rock is the company s tactics to widen its market coverage. The development of Hard Rock Cafe Ho Chi Minh shows a positive mark for the company s being in Vietnamese market. More than that, the concern seems to make good and program to do its following move to Hanoi. Mr. Thai Viet expects to open 4 more HRock coffeehouse in the following 3 old ages and believes Hanoi, Ho Chi Minh metropoliss and Da Nang where life criterions are hig her than norm will be good topographic points for Hard Rock. He besides has strong assurance that Hard Rock does non hold any rival as no other coffeehouse an offer such original experience to the clients ( Thien, 2010 ) . Mr. Thai Viet seems to be excessively posotive because even when this coffeehouse does nt hold any challengers, the available of replacements can still impact its overall public presentation. Although Hard Rock coffeehouse Vietnam offers lower monetary values for repasts in compared with its other subdivisions in foreign states due to favourable factors like inexpensive supplies and low operation cost, the monetary value for a Hard-Rock experience is still higher than the mean market of Vietnam. For illustration, the lowest monetary value for a cup of java in Hard Rock is 50,000 VND while java in the market is offer at around 20,000 VND per cup. Many people would instead take to hold java in normal store and wage less. Additional, some metropoliss like Da Nang whe re there are many epicurean resorts forming indoor activities and jubilations that are already included in a bundle for their invitees, it is improbable that tourers will jump the events and fall in Hard Rock. Hard Rock, hence, will hold to set these factors into consideration. Another job is the monetary value of land in Vietnam is really high, no affair if it is for purchase or rent. As the investing rises, location analysis become more ambitious for the Cafe because longer clip will be required earlier Difficult Rock can get down doing net income. Human resource About human resource, Hard Rock Vietnam can do advantage of the plentiful and inexpensive labour. As the lower limit pay in Vietnam is 750 VND ( around $ 32 ) contrast to $ 1,740 in the U.S ( About.com, 2009 ) , Hard Rock can anticipate to diminish its salary disbursal greatly, therefore, raise the net net income. Meanwhile, inexpensive labour normally have limited accomplishments and requires more preparation. In Hard Rock, where employees do non simply take orders but inspire the clients with the Rock-n-Roll spirit every bit good, trainining become more onerous. With music memorabilia holding linguistic communication different from Vietnamese, employees will hold difficult clip explicating to the clients significance of each vocal. Therefore, Hard Rock in Vietnam should supply a music briefing on a regular basis in add-on to general preparation class to guarantee the employees apprehension of the Rock-n-Roll history every bit good as the basic significance of the day-to-day vocals played in the Cafe. Runing concern in Vietnam means Difficult Rock as to purely follow the local authorities s ordinances related to labour. Child labour, for case, is purely prohibited. Hard Rockc will non be allowed to engage people under 15 old ages of ages for any place in the Cafe ( Save The Children, 2010 ) . Simultaneously, it has to supply equal occupation chances and benefits to both male and female workers. Cafe hire people to work extra-time, Harmonizing to Vietnamese Torahs, every shop has to shut before 12pm. Therefore, to use people working after this clip will besides be banned. Employees working in Vietnam might requires the same on the job conditions as in other states once they are employed by Hard Rock, irrespective of whether the coffeehouse is owned or franchised. It, hence, will be sensible for an employee to inquire for a $ 10,000 Rolex ticker after working 10 old ages for Hard Rock. In around 10 old ages times from the Cafe s constitution in Vietnam, when it might merely break-even its operating expense cost, whether Hard Rock will be able to pay another huge amount for honoring its loyal employees should be a inquiry leave to the directors. Quality The major job that remains unresolved in Vietnam for many old ages is nutrient safety. The World Heath Organization representative in Vietnam ( 2010 ) estimates the cost of food-borne diseases, doomed of production from diseases and related affairs to be US $ 1 billion per twelvemonth, equal to 2 % of the state s GDP. Since what people eat affect their wellness straight, happening healthy nutrient supplies have been the concern for everyone in Vietnamese society. As Hard Rock has been known as an upscale service supplier that earnestly follows its nutrient criterions, the presentation of Hard Rock in Vietnam match the clients hunt for a dependable restaurant.This surely is a great chance for Hard Rock. Nevertheless, to keep high-quality repasts in Vietnam is highly hard when the market is flooded with unhealthy ingredients. Even more, some ingredients are traded freely without the clients recognition of beginning or authorities s license. The quandary is while Hard Rock Vietnam can non merely purchase any nutrient in the market without inspecting for quality since it will negatively act upon the Cafe s hallmark, it surely will non import all of its nutrients overseas either because this will do the monetary value of repasts unreasonably expensive for the consumers. How to equilibrate the quality, the cost of natural stuffs and the interests of clients will be a complex inquiry for Hard Rock to reply. Ideally, Hard Rock should incorporate both the domestic and foreign supply in its operation. As for the imported stuffs, Hard Rock will hold to guarantee that those nutrients are allowed by the authorities and are cleared from review. With domestic nutrients, Hard Rock should merely contract with realiable providers who have standardized nutrient reaping or treating system and have the ability to orient to the nutrient quality demand of Hard Rock Cafe Decision Developing comprehensive operation schemes that are alligned with and responsive to the market trends is the cardinal success for Hard Rock. The Cafe is really prudent in happening its places, serious in pull offing its human resources and strict in commanding its merchandise s quality. Apparently, even the best can still be better. By doing its location stategy more congruous with its net income mark, Hard Rock might be able to turn up itslef in more possible topographic points, avoiding unstable concern environment which caused the underperformance, and therefore, destruction of several Hard Rock Cafe shops. More effectual employee rating tools should be used to maintain the right employees and extinguish unsuitable people. The quality criterions in Hard Rock should be kept on and closely monitored so that to keep high degree of client s satisfaction, which adds to the Hard Rock s repute. As states differ from one to another, Hard Rock no affair how experient in its field, will come across certain chances every bit good as challenges one time researching a new market. Vietnam, in its class of developing, will be a prospective finish for Hard Rock. But to fufill its enlargement program to Vietnam, the Cafe has to get the better of the troubles awaits. However, with its flexibleness and strong inner capacity, Hard Rock has its grounds to anticipate another success.