current strategic position of Lola's Cupcake

 1.0 Introduction

The following report is aimed to understand the current strategic position of Lolas Cupcake; assess strategic choices on the China land and managing strategy in actions. The entire report will provide a more in depth strategic analysis of Lolas Cupcake. It will be evaluating a more comprehensive detailed analysis of Lolas Cupcake along with the competency, and strategic analysis in the market. Different strategic models are analyzed based on PESTLE analysis, SWOT analysis, and Porters analysis. The strategic analysis using these tools assists in a better strategic management. The focus is on different environmental perceptions, as well as the policies of Lolas Cupcake. (LinkedIn, 2020). Various factors will be analyzed in the entire report to provide a more profound and critical evaluation. At the same time, the whole focus of the report is on the strategic management as well as different managing strategies and after effects of the new franchise project in China. The report includes strategic management along with its impact on the business enterprise. Various frameworks and policies are introduced in a particular way to have an in depth evaluation of the topic. Strategic management can even make or break the business environment, and the need is to define a suitable method for the progress and development of the business enterprise. So, the report describes the strategic evaluation and practices that are assigned to provide a critical analysis of Lolas Cupcake and its relative franchise. The industrial background and several business platforms of the company indicates that Lolas Cupcake has a definite place pf strategic management in the market. Other than this, China provides a lot of opportunities if the business firm of Lolas Cupcake established there. Strategic management provides the business with a lot of opportunities that comes out to be the expansion of business strategy. The market development, service development, market analysis, and the diversification of the Lolas Cupcake are also included in the report.
1.1 Importance of strategic management

Johnson et al., (2017) defines strategy as the long term direction of an organization. The importance of strategic management in the long run is underlined by three horizons framework (Figure 1). Following these domains, with different level of focus, business is expected to expand and grow, soon or later.

Strategic management is a management technique that enables the determination of prudential aims and goals by identifying a necessary process to achieve the proposed goals affirm Durmaz and Dü?ün (2016). According to Rasouli et al., (2020) The organizations strategic plan is a guideline of an effective management for implementing short and long term program. Also, strategic planning is a regular process of reviewing the organizations requirements, environmental conditions, customer relationships, organizational capabilities and weaknesses(ibid).

Strategic change is an emergent and continuous process that are distributed across different levels of the organization (Friesl and Kwon, 2017).

 

1.2 Company and Industry Background

Lolas Cupcake bakery was started by two friends in 2006 in a London kitchen, affirms Quin (2017). Lolas Cupcake creates a range of cupcakes, personalized cakes, and layer cakes using finest ingredients, handcrafted in a funny, indulgent and yummy flavourful way states Jade (2017). The companys bakery also produces brownies, cheesecakes, loaves and bundts, cookies, breakfast pots, sandwiches, cones and muffins, savoury pastries (Lolas Cupcake, 2020).  Furthermore, it started groceries boxes delivery and cake kits with a step by step guide (ibid).
According to the company official website, their main sales channels are a) through stores, 26 stores in London, located mainly on underground stations and shopping centres, out of 45 stores overall in the UK, b) online with a two days order notice, or using the Cupcake Hotline. The gluten free products, vegan product and free from refined sugar products offered to consumers are evidence of allocating resources to new products and answering the consumer needs (PWC, 2018). The gluten free products, vegan product and free from refined sugar products offered to consumers are evidence of allocating resources to new products and answering the consumer needs (PWC, 2018).

The business launched brownies through letterbox service, allowing brownies to travel to consumers address (PWC, 2018) and this is an extraordinary approach of keeping connected with the customers. Additionally, Lola’s Flowers’ ‘service , where hand tied bouquets could be used  as a gift for birthday and anniversaries are available for now on their official website (LOLA’S Cupcake, 2020).
The company supplier list includes from small cottage businesses to large organization, from which is required quality, consistency and reliability state Enterprise Nation (2015).

 According to the official company LinkedIn profile (2020), it has opened concessions in Harrods, Selfridges and Topshop, a flagship in Mayfair and an online store. x

Vision of expanding and growing overseas belongs to Asher Budwig, who acquired Lola’s Cupcake in 2010 (Enterprise Nation, 2015). Introduction of new merchandise, expanding through franchising and focus on customer needs pushed the company to a new level(ibid).

The company has achieved international success since the cult of Cupcake has reached Tokyo, Japan in 2015.
Internationally, firm has already established two stores in Japan and one in Dubai and it is open to franchise opportunities in Saudi Arabia, Bahrain, Dubai, Tokyo and Nice (ibid).

According to PWC (2018), along with dietary wishes one of the customers operations focus of the business is directed to digital development by interacting with consumers through online videos presenting cakes being made.

From technological perspective, company is opened to embrace new know hows that will increase efficacy, for instance software that plans the route for the next day in seconds (ibid).

Industry Background

presents the expected impact of COVID 19 on the sweet baked market according to Mintel expertise. It provides an analysis of potential changes in consumer buying behaviour in short and long term perspective. Starting with 2021, Mintel (2020) expect similar retail performance as in 2008/09, meaning market resurgence.
In the context of current pandemic consumer anxiety about the health and protective financial behaviours still reach high levels according to Mintel (2020). Despite the Covid 19 outbreak and its economic disruption, consumers’ overall financial well being has remained remarkably stable in recent months (ibid). While, the Bank of England expects unemployment to reach 8% by the end of 2020, and to still be at 7% in 2021(ibid).

Retail sales of tea and coffee were up, and 45% of adults say they are drinking tea more frequency since the start of outbreak state Mintel (2020).
Direct to consumer channel (D2C) becomes a more important revenue stream due to consumers’ more limited opportunities to shop(ibid). For instance, Heinz introduced Heinz to Home online service filling the gap from retail stock shortages, or Nestlè, who joined Deliveroo’s Essential delivery platform, which allow consumers to order a mixture of   their products (Mintel, 2020).
Sales of recipe box subscriptions  and sure to succeed options for scratch cooking are also reported to be in extremely high demand (Mintel, 2020).
Also, Mintel (2020) reports that  concern around being in busy public spaces is expected to have a long lasting impact on consumer psyche. This aspect is reasonable to be taken in consideration by the business.

On the one hand, cakes and sweet bakes are enjoyed by almost everyone, (91%, for the last three months) but at the same time most people adapt their diet to ‘everything in moderation’ mindset affirms Mintel (2020).Based on these criteria,  Lola’s treats components fully fit consumer needs, as may be created gluten free, dairy free, vegan, refined sugar free and using organic flour and natural ingredients (Lola’s Bakery, 2020).

Whole cakes have an intuitive association with sharing, typically linked with specific celebrations, birthdays for example.

2.0 External Analysis (850 words)
2.1 PESTLE Analysis

C.Political Factor
The republic of China is governed exclusively by Communist Party of China for more than 68 years (MarketLine ,2018). In terms of stability, China is mainly governed by CPC, which is no more able to manage a complex modern economy affirms Whalen (2019). On the other side, 84% of Chinese sustains highest level of trust versus government activity and forthcoming regulations (Forbes, 2018).
Government policy and upcoming legislation has a direct influence on the current and future business environment. Figure 12 presents the likelihood of risk occurring to export transactions and direct investment into Chinese market. This assessment depicts risk probability for export transactions and direct investment. Also, as the world’s second largest economy its existent shadow banking activity puts pressure on the worldwide financial stability (MarketLine, 2018). SME should take in the account political unpredictability and overall circumstances that may influence the operations.

B. Economical Forces

Currently, China’s economy is expanding at its weakest rate in nearly three decades, but the government has vowed to keep growth within a reasonable range in 2020 and keep policies forward looking and effective (CNBC ,2019). Chinese GNI per capita has changed considerably, from 330$ in 1990 to 9,460$ in 2018 (World Bank, 2020).

According to World Bank (2019) China has increased considerably its GDP figures, from 1,211 trillion in 2000 to 13,608 trillion current US dollars in 2018. Though, according to National Bureau of Statistics of China (2020), from 2015 GDP growth rate decreased with approximate one percent (Figure 14).

China’s Global Competitive Index (GCI) increases by 1.3 points in 2019 and reaches 73,9, the 28^th position worldwide (World Economic Forum, 2019).

Its inflation rate is relatively low but unstable, with a maximum of 5.92% in 2008 and a minimum of 0.7% in 2009 states World Bank (2019). In 2019, its economic inflation rate reached 2.89% value (World Bank, 2019). 

Also, significant reduction has been achieved in poverty alleviation affirms National Bureau of Statistics of China (2020), from 5.7% in 2015 to 0.6% in 2019 (Appendix 3).

China registered a relatively high HDI, an approximate value of 0.785 points out of 1 (United Nations Development Programme, 2019).

According to World Bank (2019) China improved significantly its business environment, by this, the Ease of Doing Business score exceeds 15 countries in 2019, taking the 31^st place. These characteristics reveals the continuous increase and development of the economic and technological efficiency. On the other side, according to Whalen (2019), the following are key risks Chinese economy is currently facing:

intensification of corporate debt

no real equity leverage in the economy

payments system that is entirely focused through the Bank of China.

Moreover, due to the transition from high speed to high quality growth, exports to domestic consumption and heavy industry to service sector development, all these lead to the growth rates moderation affirms HSBC International Business Guides (2020).

C. Social

Although, population growth rate has been maintained relatively stable, 0.5% 0.8%, by the one child policy implemented in 1980’s data from World Bank Group (2020) presents that the China population has increased by 22% since 1990, from 1.13 bn to 1.39 in 2018. Consequently, ageing population along with the created massive gender imbalance, (Philips, 2015) led the government to lose the policy and allow Chinese couples to have a second child. According to National Bureau of Statistics of China (2020) there is a 2.2% discrepancy in the gender proportions.  

In terms of demographic and urbanization features, it’s reasonable to expect that more economically affluent regions will have high consumer and diversity demand affirms Liu and Ye (2018). According to Department for International Trade UK (2020) demand from Chinese consumers for high quality goods is increasing.

Hu and Chen (2016) affirms that despite fast economic growth of China, many Chinese companies took advantage of on going cultural cringe. Mouratoglou (2014) states that Chinese diet changes and foods preferences shifted towards ‘‘Western’’ foods. Cultural cringe refers to an internationalized inferiority complex which lead people to dismiss their own culture as inferior to other cultures states Hu and Chen (2016).

 In order to satisfy the desire for higher social status, many Chinese consumers imitate consumption practices of the West, theory of conspicuous consumption, (Veblen, 1925). For instance, proffered Western style or English names to re label Beijing traditional products, to make them more ‘‘international’’ and increase sales too, supports Hu and Chen (2016).
These facts should be taken in consideration by SME as it may generate market opportunity.

D. Technological

Chinese rapid industrial development has been achieved by increasing technological advancements and huge FDI which positively influenced productivity affirms Fogel (2010). According to HSBC International Business Guide (2020), China is one of the world’s largest digital economies, holding massive investments for innovation, artificial intelligence and cloud computing. It’s GII equals to 54,82 points (Global Innovation Index ,2019). Moreover, in the China’s five years plan, key targets focus on of R&D, Internet Penetration and Patents states InterChina, China’s Business Environment (2018). The technological progress will impact positively the overall economy and therefore the disposable income. From SME perspective is beneficial as the consumers purchasing power will increase and the upcoming new technology will ease the operations estimate.

E. Legal

Government policy influence the timeline and cost of market entry. According to Hedley (2020), Chinese regulatory bodies often operate in a quite opaque manner, making it challenging to anticipate regulatory changes before they happen.

Moreover, the regulations are often vaguely worded to interpretation, which is disturbing foreign companies used to a more transparent regulatory environment.  A qualified and local advisor and interpreter is compulsory for SME, to fit local policies and follow the company objectives.

Currently, the UK does not have a trade agreement with China, and until the end of the 2020 certification of origin is still valid and can be used (Gov.UK, 2020). This feature should be taken in consideration by the SME starting with the next year.

2.2 Micro (5 Forces Framework)
3.0 Internal Analysis (Introduction )  (15% =600 words)

SWOT analysis:

SWOT analysis helps in the identification of the internal environment, and to maintain the sustainability of the internal environment. SWOT analysis is the acronym of strengths, weaknesses, opportunities, and threats. Analyzing these factors helps in the better evaluation of the internal environment. Lola’s Cupcake proceeds with the application of SWOT analysis in the domestic environment, and it helps in the strategical use in the private business firm. SWOT analysis provides the business firm with the opportunity to excel and spread the business even more in the market. It provides Lola’s bakery with even vast exposure and the more considerable experience of the working environment. Following is the SWOT analysis of Lola’s Cupcake:

Strengths:

Lola’s Cupcake has a right place in the market, which enhances their productivity and competency in the internal market. Lola’s Cupcake provides a wide variety of flavours to their customers. The appealing cupcakes engages the attention of the customers. Lola’s Cupcake introduces different strategies to maintain the competency as well as the profitability. They have the best consumer services, as well as the affordable range of price. They have also supported the economic stability to enhance the revenue and profit. While for several strategic implementation in China, the industrial policy will be improved, as China has a more substantial place of business firm. GDP of China also has a stronger position with a percentage of 9.5% in the year 2018. The economy of China is also rising, so this will be enhancing the per capita income of Lola’s Cupcake.

Weaknesses:

Although Lola’s Cupcake is every efficient in the strategic practices, but still it has some weaknesses. Quality control is very challenging for the entire business firm as the network of Lola’s Cupcake is very vast. The business firm must introduce multiple methods of sale and stock replenishment in the internal environment. One of the weaknesses with respect of China be that due to the large population of China, it will not be essential for the company to maintain quality with a more significant level of inventories. China has the second largest world’s economy, but various factors are also involved in it, which might be a weakness for Lola’s Cupcake. Lola’s Cupcake must be devising different ways for doing market analysis, as it is a weakness of the business firm. (LOLA’S Cupcake, 2020).

Opportunities:

In regards to China’s economic policy, Lola’s Cupcake has a vast number of opportunities for enhancing and exploring the business firm more. The cost of market entry and the improved financial system will be providing Lola’s Cupcake with a chance to improve the business environment. China’s rapid development also provides Lola’s Cupcake with an opportunity to excel in the field of digital marketing. It will also be improving the SME perspective that is beneficial and productive for the business firm. Lola’s Cupcake also provide employees with a more excellent range of opportunities to employees and the business firms. (LOLA’S Cupcake, 2020).

Threats:

The possible threat to Lola’s Cupcake is the changes in the economic policy and the external environment. Change in the financial system, market trends, and technological advancements will be challenging for the entire firm. China’s advanced economy policy might also threat the business firm, as it also has a relatively larger population. The population of China also requires Lola’s Cupcake to introduce even more resources to meet the market demand. Changes in the legal policies, as well as in gross domestic product, are also challenging for the entire firm. Political changes and new entrants in the market cause threat to the systems of the business firm. (Forbes, 2018).

PESTLE analysis assists Lola’s Cupcake to introduce more opportunities, and to deal with the threats that might impact on the Lola. PESTLE analysis guides Lola to enter new strategies into the business environment, as this strategy assists in regulating and anticipating the possible changes. The possibility of threats in Lola’s company will provide the firm with a chance to make positive and productive changes in the working environment. Various opportunities give the firm with an opportunity to enhance business in China as well.

4.0 Competitive Strategies (20%=800 words)

Identification of Competitive Strategies

Competitive strategies are the plan of actions that allows the company to stay competitive concerning the external environment. Every business enterprise has a competitive policy to examine the strengths and weaknesses—the examination proceeds by the comparison of one company to other. The competitive strategies involve cost leadership, differentiation, and market segmentation. The competitors of Lola’s Cupcake are Gigi’s Cupcake Franchise, Liz Earle Beauty Co. Limited, and Happy Planet Foods. Lola’s Cupcake followed the positive disruption strategy to excel the business in the market. (Forbes, 2018). The digital marketing strategy is the most efficient one that enhances the productivity of Lola’s Cupcake. The business firm examines different strengths and weaknesses to improve the productivity and to stand in the competitive environment. They engage the customers by providing them with the best experience. The company introduces several competitive strategies based on the external environment. Lola’s bakery also identifies relevant factors to enhance the competency in the market.  (Mintel, 2020).

Porter’s Generic Strategies:

For a more in depth analyzation of Lola’s Cupcake, Porter’s Generic strategy will be of great benefit. Porter’s five forces analysis aids in a better understanding of the business environment. It includes strategic analysis to maintain the sustainability of the business. Following is Porter’s Generic analysis to Lola’s bakery: (Mintel, 2020).

Threat of new entrants:

New entrants in the market might be risky for the business firm, as it decreases profitability as well as the productivity of the business environment. Lola’s bakery modified their structure is such a way to deal with the existing barriers that are present in the market. But for reducing the risk of already present companies, it looks over the government policies, product differentiation, brand equity, sunk costs, as well as the industrial profitability. This makes their business competent and sustainable concerning the external environment.

Threat of the substitute products:

For the existing substitute products as well as the market competitors, the business enterprise devised the internal system in such a way that it makes Lola’s bakery sustainable. For this purpose, they try to stay competitive by making changes in the domestic environment. The factors on which Lola’s bakery is working include propensity of the buyer, the performance of already present competitors in the market, an enhanced level of product differentiation, substandard product, availability, and the quality of the products that they are supplying. Lola’s bakery worked upon all the practices to deal with the possibility of the existing threat. (LOLA’S Cupcake, 2020).

Bargaining power of the customers:

The bargaining power of the customers can put any firm under pressure, and it might also impact on the profitability. For this purpose, Lola’s bakery had implemented the loyalty programs into their firm. The use of this is to maintain the market price as well as the to get with the factor of buyer concentration and firm ratio concentration. The business has a fixed valuation on most of the items, as this helps in dealing with the bargaining power. (LinkedIn, 2020). The uniqueness of their industry products also reduced the bargaining power of the customers. Also, Lola’s bakery functions with the application of the customers value analysis, along with the amount of trading. It helps the company to stay competitive. (Mintel, 2020).

Bargaining power of the suppliers:

suppliers are those that provide the business with labour, services, and the required material. Supplier management is highly essential for any business firm as it broadly impact on the company. For this purpose, Lola’s cupcake analyses the strength of the distribution channel that is providing the products. It analyses multiple aspects of costs as well as the input differentiation to cope up with the bargaining power of suppliers. The business firm proceeds while considering all these factors, and it enhances the productivity as well as the sustainability. (Mintel, 2020).

Intensity of the competitive rivalry:

it works for the determination of competency in the external market. Different factors are involved in the measurement of this factor, which includes the degree of transparency, the competitive strategy, skill with the other companies of the market, as well as the competitive advantage concerning different innovations introduced in the company. It makes Lola’s company competitive and a sustainable firm. It indicates that the firm is quite competitive in the external environment. (LinkedIn, 2020)

The porter analysis identifies that Lola’s bakery is very competent in the market, and it introduces different strategies in its management system to enhance the level of sustainability in the market. Porter’s five forces identify the buyers, suppliers, as well as the competitors of Lola’s bakery present in the market. It also helps in the better environmental competency. (LOLA’S Cupcake, 2020).

5.0 Strategic directions (20%=800 words)

Strategic directions (Markets, Products, Services) (Think about which M or P or S to enter or offer)

Lola’s Cupcake defines its strategic directions along with the plan of action to enhance the SMART goal achievement. For this purpose, the company performs functional operations along with objectives, required resources, and the accomplishment of the organization. Lola’s cupcake processes by the application of proper strategic management, which makes the right place in the economy. Market analysis, product analysis, and the service directions proceed with the strategic direction management. Let us explore every strategic direction one by one:

Market:

Lola’s Cupcake has a right place in the market, and due to this reason, it’s business firm is expanded in different countries. The business firm of the business is firm, and it has developed in the market by doing situational analysis. For coping up with the economic changes, Lola’s cupcakes apply the strategic implementation in such a manner that enhances the chances of success as well as the goal achievement. (LOLA’S Cupcake, 2020).

Products:

Lola’s Cupcake provides the customers with an extensive range of products, with almost every flavour of the cupcakes and other bakery items. The digital marketing enhances the public demand, and the strategic monitoring of their business improves the quality of products.

Services:

Consumer services of the Lola’s Cupcake are one of the appealing factors of the business. The firm functions by the implementation of strategic direction. It includes several plans, weaknesses, as well as the strengths of the firm. Other services includes discounted vouchers, consumer services, and membership opportunities. (Mintel, 2020).

Methods of expansion

For the methods of expansion, Lola’s Cupcake introduced different business firms at various locations. For this purpose, the most common strategic approach of development at Lola’s Cupcake is the franchising, and the business opportunities. Lola’s Cupcake proceeds with the more significant enterprise of units at different places. It provides the company with a chance to enhance the firm growth and to implement an expansion strategy efficiently. ( LinkedIn, 2020) . The new product lines and different market segments helps Lola’s Cupcake to explore even more. The success at the international level is an indication that Lola’s Cupcake has achieved the strategic expansion in the market. Also, it is targeting the London’s best trend in case of bakery kitchen. Lola’s cupcake franchise in Japan, and Dubai is a prominent example of this. And the rolling out to 1000 cupcakes every day serves to expand the business even more in market. Although COVID 19 somehow has an impact on the industry, but still due to its strategic intervention, it devised various methods for maintaining the entrepreneurship skills. The franchise agreement in 2015 also expanded the business enhancing the overall economy. Also, the increased number of stores and the exclusive market of opportunities leads to its one of the methods of expansion. (Mintel, 2020).

In a concluding note, Lola can make the firm more productive and profitable to enhance the market demand and to make possible changes in the internal environment. Lola’s Cupcake can improve the bargaining power by introducing the fixed prices of its products. The fixed costs and the discounted offers with be helpful to improve the profitability and productivity of the business firm. Despite this, the current strategies which the business firm is using are required to be polished as per the economic needs of China. The external environment might impact on China, so there is a need to introduce such strategies that proves out to be profitable. (LinkedIn, 2020).

Generic competitive strategies:

Generic competitive strategies is essential to determine the profitability and productivity of the working environment. The following are the competitive strategies will be helping in the analysis of Lola’s company:

Cost leadership:

The cost leadership of Lola’s Cupcake is highly effective and productive as it introduces such market strategies that are of low cost and high profit. But as per the economic demands of China, the firm needs to be even more sustainable and achievable. Lola’s Cupcake has the performance of above average, which means that it has strong cost leadership. (LinkedIn, 2020).

Differentiation:

All the buyers highly value Lola’s Cupcake in all the dimensions due to its enhanced variety as well as multiple attributes to attract the attention of the customers. In the industrial perspective, Lola’s Cupcake has its unique and profitable positions.

Focus:

Lola’s Cupcake focuses on both the factors of the competitive strategies. The two variants are although implemented in the Lola ‘s Cupcake, but are not that much effective. For introducing the firm into China, there is a need to implement both the variants of focus in the business firm. It will be valid for cost advantage as well as for the differentiation focus in the market. (LinkedIn, 2020).

Differentiation strategy is the most stronger one here that can enhance the productivity and profitability in the firm of China. This will be a plus point for the company to improve the productivity of the business firm. (LOLA’S Cupcake, 2020).

Strategic Direction:

Ansoff matrix is highly useful to determine the strategic direction of Lola’s Cupcake. Lola’s Cupcake has different strategic directions that will be enhancing the growth of the company is premises pf China:

 

Ansoff matrix

Ansoff matrix determines the strategic direction of the business firm to make advancement in the market. This will be enhancing the introduction of new products in the market. The product development and the market development in China will be impacting on the economy as well as the diversification and the market development. (LinkedIn, 2020).

The most effective and strongest side of Lola’s Cupcake is the product development. Product development enhances the market demand as well as the profitability of the working environment. Lola’s Cupcake defines its new products in the market as per the requirements of the customers. Introduction of Lola’s Cupcake in the premises of China will be beneficial for the economic development of China, and it was profoundly enhancing the profitability and worth of the business firm. Lola’s Cupcake is providing the marketing with diversified and new products that grab the attention of the customers. It enhances the market development day by day. Also, the improve in the profitability and economy of Lola’s Cupcake is a evidence to improve the market productivity and profit. China’s more significant population and prosperity will be suitable for Lola’s cupcake strategic direction. (LOLA’S Cupcake, 2020).

Conclusion and Recommendations

Lola’s Cupcake is one of the most prominent business firm in the category of bakeries. It has a lot of strategic choices in China that serves to enhance the business firm as well as the productivity of the company. For expanding the business, they are also working on a new project in China for the sake of increasing their franchise. The report described the strategic analysis of Lola’s Cupcake while referring to China’s latest project. Different economic factors and market strategies are analyzed for a more in depth analysis of the Lola’s Cupcake and its new project in China. (LinkedIn, 2020). The food experience and the quality of their products are included in their strengths. Different franchises, market analysis, establishment of the business firm, and the establishment of the business firm enhances their global growth. Lola’s Cupcake has a vast range of products in the market, which work to engage the interest of customers. China’s project will be of great benefit for the company and the business enterprise. It will be growing the market demand as well as it will function to enhance the business firm in different countries. China’s more robust policy and large population is an indication of the expansion of strategy. Environmental perceptions planning techniques, and the determination of different systems indicated that it corresponds to the compelling strategic analysis. The strategic direction of Lola’s Cupcake is very strong, and this is a sign that the business firm will be having a strong position in China. (LinkedIn, 2020). Also, the Ansoff matrix evaluation showed that the market development of Lola’s Cupcake is robust, and it will be highly effective in enhancing its profitable as per the demands of the customers. Many business firms like McDonald’s and Burger King by the introduction of these strategic policies increase the productivity as well as the market demand. Same is the case with Lola’s Cupcake, which functions to enhance the diversification as well as the market development.

The recommendations include:

1. Lola’s Cupcake must be doing strategic analysis and risk management policies for starting up the project in China.
2. It must be devising different ways for quality management in a different franchise.
3. Every franchise must be providing the customers with unique quality and freshly baked cakes.
4. The franchise in China must be following the strategic direction, as in the Ansoff matrix model. (LinkedIn, 2020).
5. Burger King and other food markets also enhanced their market demands due to the introduction of this strategic direction and several analysis. Lola’s Cupcake must follow the likewise strategic direction to increase the market trends and diversification as per the needs of the customers.
6. Lola’s Cupcake must be introducing decision making policies in the internal environment to meet the demands and the requirements of the customers. (LOLA’S Cupcake, 2020).
7. Lola’s Cupcake will have more opportunities to enhance the profitability if it works on the strategic analysis and fits on the demands of the environmental perception.
8. Business involves risk and profit loss situations, the need of Lola’s Cupcake is to redefine its policies as per the market trends and the demands of the customers. Because food companies like Nestle, PepsiCo, Inc, and JBS are redefining their strategies as per the directions of the market, this is the reason that they have the most significant food sales from now. So to meet the demands of the customers, Lola’s Cupcake must be following the new market trends and the population and requirement of customers.

 

References:

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