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External Environment Analysis

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PEST analysis and Five Forces Analysis of California Pizza Kitchen

Step One: Using the sources you identified in the SLP, collect some data to support an industry analysis of each of the 5 Forces in Porter's Model.
Step Two: Using the sources you identified in the SLP, collect some data to support an analysis of each of the 4 elements in the PEST analysis. When considering economic data, use the most current data you can find.
Step three: In a 4-5 page paper, write up the results of your external analysis, and be sure to label each of the 5 Forces as either high, low or moderate. Taken together, the 5 Forces analysis and the PEST analysis should lead to conclusions about the opportunities and threats facing CPK as revealed by your research. The data you report from the 5 Forces and PEST analysis must be properly cited through intext citations and a reference list, or footnotes.

Write in one page an Executive summary: a synopsis of the main points, conclusions and recommendations made in the longer report.
��Introduction: State the main purpose of the paper (thesis statement), what you hope to accomplish, and how you will go about doing it.
â?¢Main Body: The "meat" of the paper. Emphasize analysis, not just description. Delineate separate topics or sections with headings. and properly cite the sources for all information that you do not come up with as a result of your own individual reasoning.
â?¢Conclusion: Summarize paper in the light of your thesis statement.

Attached is the SLP where the information is provide to conduct this analysis.

The response addresses the queries posted in 1500 words with references.

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The response addresses the queries posted in 1500 words with references.
//As per the directions, in this paper we have conducted a PEST analysis and Five Forces Analysis of California Pizza Kitchen. PEST analysis has been conducted to analyze the complexities in the external environment of the firm. Porter's Five Forces analysis has been conducted to reveal the various challenges faced by the firm in the pizza restaurant industry. Further, opportunities and threats were identified by this analyses.//

Executive Summary

This paper deals with the external environment analysis and industry analysis of California Pizza Kitchen. In the introduction section, the purpose, the outcomes, and the methodology adopted have been mentioned. Further, a PEST analysis has been conducted followed by a Five Forces Analysis.

In PEST analysis, it has been found that the company has to abide by numerous government regulations, but it has not reflected negatively on the profits. The company is likely to face some economic constraints in terms of costs of the supplies, expansion plans, credit supply, and insurance costs. The company may have to deal with negative impact on its future profits and EPS because of its lack of control on franchising and licensing partners. The company's profitability may get affected in case the consumer preferences about the offerings will change especially in terms of nutrition and health related issues. The company is abreast with technological advancements in the industry.

In Five Forces Analysis, it has been found that the bargaining power of suppliers is quite low as the nature of supplies is generic and easily available. The threat of new entrants is very high, which can be attributed to very low entry barriers in the restaurant industry. The bargaining power of buyers is moderate as consumers are generally loyal as far as they get value for money. Threat of substitutes is again moderate as the company is already producing frozen pizza, which can be the main substitute, but as the economy is reeling under recession, and people don't have much disposable income, so they can opt for home cooked food instead. The competition is very fierce in the industry with innumerable restaurants present across the country and the key players are quite well-established.

Going forward, the company should look forward to consolidate its current position by keep on differentiating its offerings rather than look for expansion in such liquidity crunching times.


The primary purpose of this paper is to analyze the external environment of California Pizza ...

Solution Summary

The response addresses the queries posted in 1500 words with references.

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External Environment Analysis

SLP02 - External Environment Analysis (Do Not Select a Specific Company)
Note: Throughout this course, it is recommended that you complete the SLP before you undertake the case analysis. Before you begin the SLP, you need to read the background materials thoroughly.
Several of the background readings (Attached - SLP02 Background Material) referred to gathering data to support the external analysis. Be sure to review those readings so you know what kinds of data are used when conducting an external analysis. The purpose of this SLP is to develop the part of our strategic toolkit that deals with gathering information for a 5-Forces and PEST Analysis.
Step One: The first step in an external analysis is to determine to which industry your target business is classified. Usually this is done through North American Industry Classification System, or NAICS code. Find a website or library reference that would enable you to determine the NAICS code of any business (Do Not Select a Specific Company or Business - select an industry such as fast foods, retail, automotive, etc..).
Step Two: Research web and library sources that would give you the kinds of data you would need to conduct a Porter 5 Forces analysis. We are not looking for sites that describe the 5 Forces, but for sites that would have data that you could use to analyze the degree of competition in an industry, or the ease of substitution, for instance. You have undoubtedly run into such websites and publications before in your core courses. Typically, they are government sources providing statistical data, industry or trade magazines or journals, general business publications, financial websites, websites for trade associations, etc. This is a two step process: First figure out what kinds of information you would need to evaluate each of Porter's forces, and then find a source that will give you that information. Find a minimum of 2 different sources for each of Porter's Forces.
Step Three: Research web and library sources that would give you data to support a PEST analysis. Find at least 2 different sources for each PEST variable.
Step Four: In a 2 page paper (not including cover page or references), list your resources from steps 1-3 above. For each source, provide a title and a URL, if applicable. Write a short paragraph explaining what information is available, how it would be useful in an external analysis, and critiquing the source (for example, What are the limitations of the source? Is one better than the other? Why?)
SLP Expectations:
You may be concise in your presentation of this SLP. It does not have to follow the conventions of a written case paper. Tables or bulleted lists may help you present the information concisely and make it easy for the reader to quickly grasp the information. You do not need an introduction or conclusion, but I would like to see a complete references for each source on a separate reference page.
Turn in your paper in to Coursenet by the due date for this module.

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