Paul Swot Analysis

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Threats:

There are still some threats which pose a risk to Paul as a brand. Local bakeries are a strong part of French culture, and are also often cheaper. This could pose a threat to Paul, as customers could chose to shop in a local bakery, where they know the store well, and prices are lower. Another threat for Paul could be the possibility to buy bakery products at the supermarket, eliminating the need for a bakery store altogether. To overcome this, Paul needs to ensure they give customers a reason to return to their stores, as opposed to a supermarket or local bakery.

Entering different markets could also be a threat for Paul, as each market will vary culturally. Paul will have to take this into consideration when expanding, as they will need to adapt to take into consideration the requirements of each market. One example of this could be the difference in eating times between cultures. For example, France will take long, two hour lunch breaks, where as many consumers in the UK market will take a 30 minute lunch, and will need to get to the store, purchase and eat the product in this time. As well as culture differences, there are also legal differences between foreign markets that Paul will need to consider.

Whilst expansion could be a strength for Paul, it could also be a weakness. By expanding the business too far, it will become difficult to keep standardisation, which could mean a loss of brand recognition and customer loyalty. Paul is a franchise, and so is not owned by one single group of investors. This means it is vital for franchise owners to understand the importance standardisation, in order to keep the brand recognition that Paul has.

Recommendations

In order to overcome some of the weaknesses and threats posed to Paul, there are several recommendations to be made. Paul can diversify and expand into foreign markets, both increasing revenue and decreasing pressure on the French market, where Paul is not as widely accepted.

Paul can also increase the services it offers, by offering an online order service. This would increase the convenience of Paul, which is one of its unique selling points, and would also increase the brand recognition and brand loyalty of Paul.

Paul could also look at further rationalising the business, which would keep costs low and customer satisfaction high. One way of doing this would be to introduce electronic ordering booths in store, to decrease the need for staff. However, Paul would have to be careful not to completely rationalise the business, as this would further push away French customers who already disagree with how untraditional the brand is.

Recruitment for franchise owners could be an area that Paul could improve. For example, in order to open a Paul franchise, 2.5million euros is required, as well as an in depth knowledge of the market. However, this is very subjective. Furthermore, Paul does state that is prefers franchise owners to have experience, however it is open to franchise owners with little previous knowledge of the area. This is something Paul could improve, by ensuring that all franchisees receive the same training, in order to increase standardisation within the business.

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Conclusion

Whilst there are some recommendations to be made, Paul has a strong brand image, and has millions of customers all over the world. Its strengths and opportunities are being utilised by the brand, which is a positive move for the business. Strengths for Paul include the convenience of the brand, and it is important that Paul utilises this. Strong brand image and brand loyalty also need to be considered, for example by ensuring that the brand is standardised in all markets that they enter. The weaknesses of Paul, including not being accepted by French culture, and straying from the traditional French bakery business model, can be overcome by the business. To do this, Paul needs to ensure they keep prices low, possibly through rationalisation.

In a growing global market it is important to seek out foreign investment. Paul has the opportunity to receive these benefits as it expands into new markets. Most investors measure the health of a franchise through growth and innovation. Paul plans to open 15 stores in the next 10 years. Investors may be alarmed by a franchise of over 400 store's expanding by a mere 15 in the next 10 years. However it is important to realise the necessity to perform market research in foreign markets to ensure positive net growth of the Paul franchise.

In summary, Paul has many strengths and opportunities, which can be used to expand the business, but also some threats and weaknesses it must consider when expanding in the future. From this SWOT analysis, it can be concluded that Paul may have some difficulties in the future, however, it makes a good investment, and should succeed in its future plans for expansion.

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References

Elliott, G., Rundle-Thiele, S., Waller, D. (2010) Marketing. [Online]. Available at:https://books.google.fr/books?printsec=frontcover&vid=ISBN9780470819654&hl=fr(Accessed: 22nd September 2010).

Groupholder. (2015). A Taste for Tradition. Available: www.groupeholder.com/va/marque-paul.php/. Last accessed 22nd September 2015.

Marketing Teacher. (2015). Three Levels of a Product. Available: www.marketingteacher.com/three-levels-of-a-product/. Last accessed 22nd September 2015.