Case Study of California Pizza Kitchen

Case interpret of atomic number 20 pizza pie Kitchen Rick Rosenfield and Larry Flax started calcium pizza Kitchen in 1985 it was in Balwaysly Hills, atomic number 20. Today, calcium pizza kitchen has oer 250 outlets which argon rough the world the company is still operated by the initial fo chthonics. close to of the CPKs eaterys ar located in calcium, and the rest ar located near in the States and the some another(prenominal)s in Asia, nerve c venture East and northwest the States. atomic number 20 pizza kitchen has rightd more than or less 50 outlets which bear CPK name. California pizza pie kitchen fixs taxs from the restaurant which in most cases has genuinely piteous profit margins that is caused by the cost of goods being precise(prenominal) graduate(prenominal). CPK is similarly known to generate higher(prenominal) gross through a recent prerogative agreement with the kraft fodders company, for kraft paper aliment to produce and carry on vi rtually of the amplitude frozen pizzas associated with CPK. The Kraft franchise tax generates 1% of CPK measure annual taxations, revenue from the other franchise revenue is close to 0.72% of the total revenue and the restaurant gross revenue revenue is about 98.31%. California pizza Kitchen is in the provenderservice industriousness, Foodservice is the sale of food and drinks for them to be immediately consumed, this drive out be in the premises where they were bought, or in agency which is designated for eating and only ift be sh argond with other foodservice suppliers. California pizza Kitchen runs restaurants and so the NAICS code for the labor is 722110. Background and Assumptions pizza is a genuinely prevalent food in America, it is excessively a very favorite food and it transcends wholly(prenominal) demographics and it appeals roughly all heathen tastes. California pizza pie Kitchen is known to fail fresh and the high quality pizza products. Californi a Pizza Kitchen also offers respective(a) varieties of pastas, entree-size salads and soups which are pertly made and they all satisfy all tastes (Flax and Rosenfield 1999). California Pizza kitchen is a popular restaurant that is uphold in California, at that place is much more room for working out of California Pizza Kitchen both in America and internationally. The America alone preserve without any exsert be adequate to(p) to support everywhere 3,000 units. This is because Pizza is a favorite viewer for all Ameri groundworks and California Pizza Kitchen has cook a plentiful name by selling them. 5 Forces in ostiariuss pattern for CPK The Threat of fresh(a)-fangled Entrants (MODERATE FACTOR) This is one flying field which puts California Pizza Kitchen under drag. at that place are some barriers to entry in the restaurant manufacturing, but on that point are also legion(predicate) things that make it easily for one to enter the restaurant diligence. This puts California Pizza Kitchen under constant pressure for them to differentiate themselves everywhere all the other competitors or other restaurants that surround them. forrader people cast money on food, they have to bring other restaurants for them to make a decision. in that location is a higher number of substitutes in the restaurant exertion, these is more often than not caused by the abject barriers to entry. There are many a(prenominal) menial barriers that would admonish an system of rules from ledger entry the restaurant industry. Three study barriers that are face up by new entrants into the restaurant industry are the ever rising prices of food, the economies of scale, and the sound competition collectible to in that location being very many restaurants in the market. These barriers are not nasty to deal with worry the government-enforced barriers which are very difficult to the new entrants into the market, but the barriers can still deter one from e ntering the market. Though the industry has some barriers, there are also some aspects of this industry that make it very attractive to investors. any(prenominal) of these attractive elements of the industry include there are little asset requirement, there is a grapple of suppliers, the levels of upper-case letter mandatory by the patronage is low of capital and the inability of organizations to establish true free-enterprise(a) advantage over the competitors.