Business Strategy

Porter's Five Forces Model

Buffalo Wild Wings is a leading sports-bar restaurant in the country. While many competitors like Stop Wings, Applebee’s and etc. are struggling to survive, Buffalo Wild Wings is expanding. The reason for that is the unique and fun atmosphere with the customer experience focus, which they have established.

Using Five Forces Model, created by Michael Porter, the company ensures brand recognition, quality, and consistency throughout their concept. Michael Porter wrote once: "Understanding the competitive forces, and their underlying causes, reveals the roots of an industry's current profitability while providing a framework for anticipating and influencing competition over time."

Porter’s Five Forces include Bargaining Power of Customers, Threat of Substitutions, Bargaining Power of Suppliers, Threat of New Entrants and Rivalry.

Bargaining Power of Customers (moderate to high)

There are many customers in the industry. BWW has repeat customers who come in to enjoy the combination of food, drinks, and sports. However, BWW is competing for sport loving customer who enjoys American cuisine. Customers do have moderate to high purchasing power, due to the fact that rivalry is high in this market.

Bargaining Power of Suppliers (low to moderate)

In the restaurant business, there are many suppliers. It is easy to switch from one supplier to another. There is no unique product the supplier can offer, so BWW can shop around and find the cheapest price for French fries, onion rings, liquor. However, BWW needs high-quality chicken to cook the best wings and needs signature sauces, which part of the restaurant brand, and are not easy to substitute. That is why the power of suppliers is from low to moderate.

Threat of New Entrants (moderate to high)

Anyone can enter the restaurant business in America. The cost of a startup business is medium. However, BWW has a brand name and customer loyalty, which others will have to prove. Customers come to enjoy signature wild wings with the choice of 18 signature sauces. Entertainment in the restaurant and the customer service is always aimed to satisfy the guest to the fullest. During football season, BWW runs special night and offer low-cost combos, which are hard to compete with.

Threat of Substitution (moderate)

Customers can choose to buy ingredients and to cook it from scratch at home. This would require time, effort and skills they might not have.

Another substitute can be fast food wings without dining experience. However, BWW has a strong brand name and provides dining fun experience, which is hard to substitute, it is more than just chicken wings.

Rivalry (high)

There is a large amount of competition including Wing stop restaurant, Hooters of America, and Applebee’s. Most of the competition can offer a similar product for the same or cheaper price. Competition is high for both customers and employees.

Differentiation Business Strategy

Buffalo Wild Wings uses differentiation strategy by creating a unique dining experience. All the restaurants are equipped with projection screens and approximately 50 additional televisions, competing in Buzztime ^® Trivia or playing video games. Guests have an opportunity to watch sports or other TV shows. BWW also offers 18 signature sauces and 4 signature seasonings to make signature wild wings. Overall, the company “strives to be the place where people want to be”.

BWW differentiation business strategy includes:

·         To continue to build a strong brand name

·         To focus on guest satisfaction

·         To offer creative flavors of wings

·         To focus on delivering unique dining experience with media systems

·         To implement new technology into the guest experience

The differentiation strategy pays off. As we have mentioned earlier, other chain restaurants are struggling to survive, while BWW’s net income is growing and the restaurant is expanding internationally. According to Fortune.com: “Over the past four years, Buffalo Wild Wings’ sales have surged 147%, reaching $1.52 billion in 2014, and net income has grown at almost the same pace”.

How Do the Information Systems Support Business Strategy? 

Information systems are closely tied into business processes at Buffalo Wild Wings. Information systems are used to collect, store and process data. The data further is used to improve the business operation and guest satisfaction. Information systems help to connect with customers, suppliers, to manage scheduling and daily operations, to set up weekly goals and monitor them, and etc. One of the latest information systems used in BWW, which are hardware with installed software, is a tablet. They added value to the guest experience and satisfaction. Tablets are closely used with guests, staff, and entertainment. They reduced human error during the ordering process, and also used as a point of sale system. 

Information systems used at Buffalo Wild Wings include:

Hardware:

PC Computer

24-7 Total Solution computer system

Point of Sale (POS) Computer

Mobile POS Stations

Tablets

Televisions

Credit Card Readers

Cash Drawers

Kitchen/Bar Tickets Printers

Printers

Software
System Software, such as an operating system program IOS, Windows and Android, are used to controls and supports the operations of computer systems and tablets.

Application software, Buzztime (to play on the tablet, to order food or pay the bill}, Table’s Ready (to control tables and sitting), and Cinemar (to control entertainment).

People

People are the most valuable asset of almost any organization. This is particularly true when it comes to customer service. People represent the company to every guest and they are involved in all the parts of business preparation. People operate the hardware which is crucial for guest satisfaction. For this reason, BWW invests in their staff by offering extensive job training. The staff has a strict procedure to follow to increase overall guest satisfaction.

Procedures

Buffalo Wild Wings procedure focuses around guests to reward them with the unforgettable dining experience. To assure fullest guest satisfaction, BWW follows a number of different procedures such as greeting and seating, ordering/taking out food, payment process, personnel hygiene, facility and equipment maintenance, orientation and training, payroll and so on.

According to the manager John, written processes are very important to the business, because they provide assurance that employees read the procedures and follow them.

Database

Buffalo Wild Wings uses a relational database management system named Oracle to store, collect and process the data. Oracle is a cloud-based database to support the needs of growing business. Highly secured with multi-layered encryption. Oracle is known to be “a highly available and scalable service delivering speed, simplicity, and flexibility for faster time to value and savings”.