RUTH’S CHRIS CASE STUDY
Is Ruth’s Chris able to succeed in foreign markets?
A decision needs to be made as to which countries have growth potential with little risk. Although the study outlines different methods to aid in determining this like market selection criteria and the growth plan model; they need a more detailed method of narrowing down their choices. Some considerations used were
1. Corporate vs. franchise and introductions of a new concept/product vs. introducing the same model to a new market
2. Can the location chosen legally import US beef?
3. Population density
4. Availability of disposable income
When evaluating the points above, the bottom line is to concentrate on increasing revenue. We can already see that franchise locations are effective and profitable and should probably continue to be established.
Ruth’s Chris needs to study each considered countries’ barrier of entry including culture, economic state and political stability. This process can filter out undesirable locations early in the game and produce a short list of opportunities.
Based on the readings, Ruth’s Chris has very strict franchisee rules. How can these be changed or relaxed to appeal to new business people? Is this the best mode of entry to other countries? Further research can be done to explore other options of ownership.
Cost, competition and demand needs also be considered prior to making a decision.
In the end when planning foreign expansion, the decision must to be grounded in the location’s profit possibilities. Expanding franchises in countries where they already have proven success is a more cookie cutter approach in markets like Canada, Mexico, Taiwan and Hong Kong. The growth path model developed by Ruth’s Chris can guide them when opening these new locations in already existing markets by using the same methodology already shown to be efficient and profitable in those same...