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Universal Education Group Ltd T/A NZNC

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Tel: 09 3799330

NATIONAL DIPLOMA IN BUSINESS

Code Title Level Credits

BUS 304 Assessment 1 - Strategic management 7 20

The aim of this component is to develop knowledge and skills for a strategic approach to
management in organizations. It enables the learners to apply tools to evaluate the
environment that the business operates in and formulate strategies that effectively
mitigates the risks from the environment, explores opportunities for growth and ensures
sustainability for the organization.

Declaration on plagiarism
I hereby declare that this piece of work is the result of my own independent scholarly work,
and that in all cases material from the work of others (in books, articles, essays,
dissertations, and on the internet) is acknowledged, and quotations and paraphrases are
clearly indicated. No material other than that listed has been used. This written work has not
previously been used as examination material at this or any other institution.

Students Name: __________________________ Students ID: __________________

Total Marks Total Marks

Learning Outcome No. Task
Available ACHIEVED
1 A 35
2 B 20
3 C 15
70
Final Mark

This Assessment weightage is 70% of the total learning outcomes.

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Feedback to Student:

Tutor: Sami

Assessment conditions:
Please read and adhere to the Assessment policy in the course outline provided:

This is an Open book class activity; you may refer to your notes and hand-outs to
complete this presentation.
No cheating will be tolerated; otherwise you will get NYC for the whole unit.
Any work taken from other source should be referenced, with referencing (APA) to
support your answers.
The work should be professionally presented with the help of Microsoft Word.
Your assessment consists of three Tasks, and are required to answer all the questions.

Cheating is:

Looking at another students work from other college.

Helping another student.
Copying from other student.
Using any other type of related material.

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Case: BurgerFuel Worldwide

Chris Mason had only modest ambitions for BurgerFuel when he opened the company's first
store on Ponsonby Rd in 1995. Back then, the founder of the now rapidly expanding gourmet
burger chain thought he'd be in and out of the fast-food trade in six months flat.
"It was basically like, 'Let's do a hamburger bar, drive it up in sales and then sell it for a profit'
- that was it," Mason says. "I was 29. I was just going to go off and do something else."

But things didn't turn out as planned. BurgerFuel opened a second restaurant - in Takapuna
in 1997 - and Mason, who worked in the kitchens of the early stores and reckons he's still the
fastest burger stacker around, eventually moved into franchising as the company expanded
its New Zealand network. Signaling its global ambitions, BurgerFuel added "Worldwide" to its
company name when it listed on the stock exchange in 2007 and embarked on international
expansion as the global financial crisis began to bite. The firm now operates 80 stores in New
Zealand, Australia, the United Arab Emirates, Iraq and Saudi Arabia. BurgerFuel, whose share
price more than doubled on the news of the Subway deal, hopes to open 1000 new outlets
over the next eight years. Reaching that target will require a huge ramping-up of new store
openings, considering it has taken almost 20 years to get to 56 sites. Casting his mind back to
1995, Mason says: "I had no idea I'd be sitting here in Dubai in 2014" (Adams, BurgerFuel
takes a bigger bite, 2015).

History
Founded in 1995, by Chris Mason BurgerFuel is New Zealand owned gourmet burger
restaurant operating in 6 countries. First of which was opened on Ponsonby Road, Auckland
with a concept to provide gourmet burger made from fresher and natural ingredients
(BurgerFuel, 2015). Within 2 years word spread rapidly about New Zealands newest gourmet
burger and the doors opened to our second store in Takapuna, Auckland.After booming trade
and huge interest from the locals, Takapuna became the first franchised BurgerFuel store.

Corporate Governance

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The Board is elected by the Shareholders of the Company. At each Annual Meeting one third
of the directors will retire by rotation. The Directors to retire are those who wish to retire, or
those who have been longest in office since last being elected. The Board of Directors is
responsible for the overall direction of Burger Fuel World wides business and affairs on behalf
of all shareholders. The Boards key role is to ensure that corporate management is
continuously and effectively striving for above-average performance, taking account of risk.
The Board:
Establishes the objectives of Burger Fuel Worldwide Limited;
Approves major strategies for achieving these objectives;
Oversees risk management and compliance;
Sets in place the policy framework within which Burger Fuel operates; and
Monitors management performance against this background. The Board has delegated the
day-to-day leadership and management of the Group to the Group Chief Executive Officer.
The Board monitors financial results and
compares them to annual plans and
forecasts on a regular basis, and on a
quarterly basis reviews the Groups
performance against its strategic planning
objectives.

Unlike the NZX Listing Rules for NZSX listed

companies, the NZAX Listing Rules do not
require that the Company have any
independent directors. However, in the
interests of good governance, and
notwithstanding that there is no
requirement under the NZAX Listing Rules,
the Directors have decided to adopt a
governance policy whereby at least 2 of the
Directors of the Board will be Independent as defined in the NZX Listing Rules. The size and
composition of the Board is determined by the Companys constitution. As at 14 June 2011,
there were four Directors, a Company Secretary and a Chief Financial Officer. The Chairman
of the Board and the Chairman of the Audit Committee are non-executive and independent
of the role of the Chief Executive Officer.

Mark Piet - Chief Financial Officer

Mark is the CFO & Company Secretary of BurgerFuel and has been with the company for 6
years. Mark is a chartered accountant & a member of the New Zealand Institute of Chartered
Accountants. Prior to joining BurgerFuel, Mark worked for Deutsche Bank & The Economist
in London.

Tyrone Foley - Chief Operating Officer

Tyrone is the group COO and is responsible for the management of all departments at Head
Office and daily operations in all markets around the world. Tyrone's previous management
roles have been with McDonald's and BP.

Chris Mason - Founding Director

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Chris Mason is the founder of BurgerFuel having opened the first store on Ponsonby Road in
1995. He is an executive member of the board of directors. For the past 5 years he has been
based in Dubai as CEO of International Markets - where he established our Middle East
business. Chriss focus is now on the USA.

Peter Brook - Chairman

Former Managing Director of Merrill Lynch (New Zealand) Ltd. Member of the Institute of
Finance Professionals New Zealand Incorporated.

Josef Roberts - CEO

Josef is the Group CEO and is responsible for the overall direction and management of the
business. Former CEO and Founder of Red Bull Australasia.

Alan Dunn - Independent Director

Former CEO and Chairman of McDonalds New Zealand from 1993 to 2003. In 2004 became
Chicago based VP Operations, then regional VP Nordics and Managing Director Sweden until
retirement in 2007. Other Directorships: Z Energy, NZ post and a number of directorships of
private companies.

John Pfannenbecker - Independent Director

John Pfannenbecker is currently serving as the Managing Attorney for Finance and
Investments, and as a member of its Executive Management Committee, for Franchise World
Headquarters, LLC, advising Doctors Associates Inc., Franchise Brands, LLC and its private
equity holdings.

Profile of the CEO

The food-fueled fortunes of Josef Roberts are generating the sort of energy you could expect
from the man who fired up his first few millions by introducing Australasians to the
caffeinated clout of Red Bull. Since ploughing some of those proceeds into local foodie
phenomenon BurgerFuel in 2003, hes been on a brand-boosting mission that has seen outlets
springing up across Australia and around the world with particular focus on the Middle East.
Despite having to shut up shop in Iraq because of the ISIS threat, Burgerfuel now boasts more
than 20 outlets in the region. In April alone, the company announced the opening of two new
outlets in Kuwait and Abu Dhabi as well as one in Pakuranga. It is also expanding its presence
in Australia and is partnering with Subway and Franchise Brands to guide its launch into the
US.

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As the listed company noted in its

last half-year report its been a very
busy time, there are no signs of
things slowing down and we have
a feeling things are only just getting
started.

Last year, Mr Roberts and

BurgerFuel founder Chris Mason
(who hold a combined 72% holding
in Burger Fuel Worldwide) both got
a multi-million pay day when
Franchise Brands bought 10% of the
company with an option to
purchase up to 50% over the next
eight years as well as providing its
expertise to help drive growth. That
investment immediately pushed the
share values up by 80% and
theyve since passed the $3 mark, giving the company a market cap of more than $180 million.

Mr. Roberts is also a property investor with a strong interest in architecture and design an
interest evident at the luxury Trinity Beach Palace north of Cairns which he once owned. He
says the brands to which he had devoted his life Red Bull and Burgerfuel are an expression
of his own personality: energetic, colorful and unconventional (The National Business
Review, n.d.).
He was bankrupt before turning 30, but bounced back and introduced New Zealanders and
Australians to Red Bull, before selling the rights back to the company in 2002. Mr. Roberts
then turned his attention to Burger Fuel and together with founder Chris Mason took the
company to the world. He now owns more than 50 per cent of the publicly listed fast food
outlet and has a portfolio of commercial and residential properties. Burgers and Red Bull have
propelled Josef Roberts on to the 2014 National Business Review Rich List with a $100 million

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fortune from introducing New Zealanders to the energy drink before switching attention to
BurgerFuel. The 52-year-old is one of 13 newcomers to the rich list, whose individuals and
families collectively passed $50 billion in wealth for the first time. Their combined wealth of
$51.2 billion in 2014 is more than double that of the 2004 list, which came in at $22.3 billion,
and well up on last year's $47.9 billion (Orsman, 2014).

Roberts Management Style

Burger Fuel CEO Josef Roberts believes culture is key to staff retention in his company. He
elaborates on ways businesses can create the right culture to ensure employees remain
engaged and motivated. Im a strong believer in creating a culture that people will actually
contribute to and feel relaxed enough, confident enough and interested enough to keep
coming to work, Josef says. We have a high retention of staff and people in the business
and I think its because weve created a culture thats fun and enjoyable (2016 NZME, 2016).

"Life is enormously challenging but exciting, and I have learned that many things are possible
if one can overcome fear, especially the fear of criticism and failure, which hold many Kiwis
back in my view.
"My philosophy in life is that I believe it's easy to look back but much harder to look forward
to the future, so every day I try and see something of the future," he said (Orsman, 2014).
To see the video you can click the Link.

Robert on Expansion
When BurgerFuel added "Worldwide" to its company name when it listed on the stock
exchange in 2007, it made implicit the companys global ambition (Adams, BurgerFuel takes
a bigger bite, 2014). According to Roberts when he joined the business in 2003, BurgerFuel
had really established itself as a brand and Chris and him saw real potential to take the
BurgerFuel concept to the world this is when they really started to focus on our global
objectives. These days, our ambition is still to deliver the ultimate gourmet burger

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experience using the freshest, most wholesome ingredients - but we now want to serve this
up in nearly every country around the globe Robert adds (ASB Bank Limited, 2014).
Josef Roberts says it gives the company the opportunity to turbo charge our business by
going into the US and other countries, alongside the largest franchise company in the world.
BurgerFuel will retain control over its unique brand and operating style and will remain a
publicly listed New Zealand company, he says (Bridgman, 2014).

Company Mission
Their aim is to supply the finest and the freshest testing ingredients available every time. To
achieve this, they ensure that all meals are made to order and prepared with utmost care,
preparation, cleanliness and burger making respect one can expect (BURGERFUEL. , 2015).

Industry
In 2014 BurgerFuel announced its expansion plans in USA. According per National
Restaurant Association, the restaurant market in USA is $782.7 billion (National Restaurant
Association, 2015). Entering the US market has considerable regulatory and legal
requirements, all of which have been a series of challenges and learning curves, with
relative costs associated. The only bright spot in this picture is the ethical and fresh sources
of raw material used in the manufacturing of the products.

M cDonalds

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McDonald's restaurants are found in more than 100 countries and territories around the
world and serve 68 million customers each
day and is the world's largest chain of
hamburger fast food restaurants.
McDonald's operates more than 36,000
restaurants worldwide, employing more
than 1.9 million people (McDonalds, 2010).
In New Zealand itself McDonalds generates
a profit of about $31 million a year for
McDonald's Restaurants on sales of $221
million a combination of franchise fees
and own-store sales (NZME. Publishing
Limited, 2015). No one has thought that the
first restaurant that opened in 1955 would
be todays biggest fast food chain. Brothers Mac and Dick McDonald founded McDonalds and
since then, people have fallen for their appealing and mouth-watering menu.

B urger King
Founded in 1954, BURGER KING is the second largest
fast food hamburger chain in the world with about
13,000 restaurants operating in 100 countries. The original
HOME OF THE WHOPPER, their commitment to premium
ingredients, signature recipes, and family-friendly dining
experiences is what has defined their brand for more than 50
successful years. Since opening its first restaurant in New
Zealand in 1993, Burger King has been delivering better
burgers for burger lovers throughout the country. Using only
the best ingredients from locally sourced New Zealand producers, meals are made to order
for each customer. Every day, more than 11 million guests visit BURGER KING restaurants
around the world. In New Zealand, Burger King has 83 outlets nationwide and employs 2,800
people in its retro US 1950s fittings restaurants, serving 'flame-grilled' burgers (NZME.
Publishing Limited, 2015).

W endys
Wendys got it allfrom lip smacking
sandwiches and hamburgers, salads and
frozen desserts, people just love Wendys and how it
successfully answers their craving for flavorful,
affordable food. Columbus Dave Thomas founded
Wendys in 1969 and has now more than 6,500
restaurants all over the world. It has an average annual
revenue of 2.469 billion dollars (Said, 2013).

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KFC
Being one of the forefront of Yum Brands, KFC has never stopped growing big and expanding
more since Colonel Harland Sanders built the fast food chain in 1930. Popular for its juicy
chicken, KFC has never revealed Colonel Sanders
chicken recipe and this has continued to be used
across the globe in more than 9,000 KFC
restaurants, in more than 80 countries (Said,
2013). Just like BurgerFuel, Wendys hamburgers
are made from fresh, never frozen beef, and
served on quality buns from select bakeries. As
claimed by the company their hamburgers dont sit
under a warming lamp or on a steam table. They
come off the grill onto the bun and into customers
hands.

Carls Jr.
Los Angeles, 1941. Young Carl N.
Karcher and his wife, Margaret, make
a leap of faith and borrow $311 on
their Plymouth automobile, add $15 in
savings and purchase a hot dog cart.
One cart grows to four, and in less
than five years, Carl's Drive-In
Barbecue opens with hamburgers on
the menu. The brand continues its
growth with an emphasis on quality,
service and cleanliness, pioneering
concepts such as partial table service
and self-serve beverage bars. The
introduction of the signature Six Dollar
Burger in 2001 marks the latest
Carl's Jr. advance in the quick-service
industry, confirming the chain's
constant emphasis on product
innovation and representing a desire to satisfy the tastes of young, hungry consumers (Carl's
Jr. Restaurants LLC., 2010).

Task A

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Question 1: On the base of information collected from the above case and your research,
Address the impact of internal and external environment on BurgerFuel Worldwide? [20
Marks]
Question 2: Develop a business strategy that positions BurgerFuel in US market most
favorably in relation to its competitors? [15 Marks]

Task B
Question 3: Critically analyze and develop plans to utilize the available resources, capabilities
and competencies to gain sustainable competitive advantage in their expansion plan is USA.
Also, formulate strategies that leverage BFW core competencies. [20 Marks]

Task C
Question 4: Develop strategies at various levels of the organization i.e. BurgerFuel
Worldwide, to gain competitive advantage and sustainability for the organization in USA the
home of hamburgers. [15 Marks]

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Level 7

STRATEGIC MANAGEMENT | Assessment 1