Ruth's Chris Steak House
HTM 310: Food and Beverage Operations Management
Professor: Israel Johnson
November 26, 2011
In this paper I will cover the four questions in regards to Ruth's Chris Steak House restaurant, though the case states that the management team felt the market development model was the most obvious mode of entry, I feel they were quick to disregard the penetration model. The fact that their only limiting factor was that “fine dining establishments would never be as ubiquitous as quick service restaurants like McDonalds” (Kutpetz and Alon, 2006) leads me to believe they did not give it enough thought. Otherwise, they would ...view middle of the document...
They could increase their number of international restaurants and revenue while still holding partial ownership of the business involved in the joint ventures. They will also be able to attract new customers through joint ventures. Countries and restaurants of interest will have to be researched and visited. Surveys will have to be done to see if Ruth’s Chris steak house would fit in the area. Ruth’s Chris steak house will have to modify their strict selection criteria because they are looking to join with other established restaurants in a market they are trying to break into. My preferred alternative is to have joint ventures in foreign countries due to the low cost of integration as well as the possibilities of attracting new and different customers.
Ruth's Chris Steak House
2006 appeared to be a pivotal year for Ruth’s Chris Steakhouse. After raising more than $154 million through its IPO, the newly public company was focused on expanding its business through both company-owned and franchised locations, including expansion of its global business. While the company already had successful operations in 10 international locations, including Canada, Mexico, Taiwan, and Hong Kong, in the following analysis I will discuss these challenges, and though there are many, I will suggest the one that I feel is the most critical. I will then offer two alternatives and evaluate them both before I offer a final recommendation. Though the case states that the management team felt the market development model was the most obvious mode of entry, I feel they were quick to disregard the penetration model. The fact that their only limiting factor was that “fine dining establishments would never be as ubiquitous as quick service restaurants like McDonalds” (Kutpetz and Alon, 2006) leads me to believe they did not give it enough thought. Otherwise, they would have realized that comparing fine dining to fast food is like comparing apples to oranges, and they should not base such an important decision on the result of this comparison.
1. Identify one cost-control challenge for this establishment and make a recommendation for addressing that challenge.
The principal purpose of food and beverage planning and control systems is to avoid excessive costs by reducing waste and other forms of loss to a minimum, without sacrificing the quality or quantity of the food which goes to the customer. Food and beverage control procedures should serve as effective “tools of management” to aid in the control of costs. They should be designed in such a way that the most effective allocation of time is made to the planning, comparing and corrective action phases of control, with the emphasis on planning (Kutpetz and Alon, 2006). Management is responsible for cost control, and should make use of every tool and technique at its disposal in order to keep costs in line with what they should be. Cost control is distinct from cost determination. Cost...