STRENGTHS

• Second Cup's major strength is its geographic presence in different regions. It enables high business reach to the target market and easy accessibility. (Source 1 pcorroborated by Source 2)
• It has a wide product portfolio that allows customer base expansion. (Source 1 corroborated by Source 2)
•  Strong online presence enables strong relationships with customers.
• Its strong financial position and health is good for further investments. (Source 1 corroborated by source 2)
• Its access to the suppliers for raw material at a lower cost improves the overall business efficiency.
• The locational advantage can improve its competitiveness in many ways, such as lower cost, improved accessibility or enhanced brand image.
• The efficient IT infrastructure can improve the operational efficiency.
• Competent and committed human capital can act as a powerful source of competitive advantage, particularly when business is service-oriented in nature.
•  High product quality expands brand loyalty. (Source 1 corroborated by Source 2)
•  Workplace diversity goes well with its intent to operate in international market.
• The horizontal and/or vertical integration can increase the control over whole value chain, resulting in improved access to raw material and quick product delivery to the final customer.
• An organization may own different intellectual property rights that can make the product offerings unique and exclusive, making it difficult for competitors to imitate.

WEAKNESSES

• Environmentalist can criticize Second Cup for its poor waste management practices and inability to make its operations sustainable.
• Second Cup has poor inventory management practices.
• Due to its cash shortage or insufficient current assets it has poor liquidity position and overall business performance.
• The company's budget for marketing is insufficient, therefore expansion and retaining customers is difficult.
•  Less expenditure on the research and development activities can weaken the company's performance due to poor local/international market knowledge.
• Poor customer service (such as inefficient customer complaint handling) can trigger the negative word of mouth about the business and affect business growth.
• The decision making takes too much time, causing expensive delays in introducing new products in the market. (Source 1 corroborated by Source 2)
• High job stress and consequent low workers’ morale is making its workforce less productive.
• The company's leadership style has the misalignment making the business organization directionless. (Source 1 corroborated by Source 2 and Source 3)
• Organizational culture is a big internal weakness due to strategic/business objectives misalignment.

OPPORTUNITIES

• The changing customer needs toward healthier products. (Source 1 corroborated by Source 2)
• The development of new technologies to assist in production and delivery. Technology decreases costs, improve efficiency and result in the quick introduction of innovative products. (Source 1 corroborated by Source 2)
• Higher customers’ disposable income and bigger affluent customer base is an opportunity to offer more high-end products.
• E-commerce and online marketing can increase its sales.
• It can expand into emerging markets and niches. (Source 1 corroborated by Source 2)
• Developing countries like India and China have the biggest markets on the planet and are good revenue opportunities for the company.
• More globalization enables higher customer reach. (Source 1 corroborated by Source 2)
•  Better relationships with schools, hotel chains, restaurants etc. can also increase the number of its consumers.

THREATS

• Changes in regulatory system are a major treat as they enable potential lawsuit.
• Second Cup does not have enough skilled workers.
•  High competition slows its expansion down.
• The deteriorating economic conditions affect business performance when they directly influence the customers' spending patterns and purchasing power. (Source 1 corroborated by Source 2)
•  Higher inflation increases the cost of production and affects negatively the business profitability.
• The growing environmental sustainability trends act as a major threat as it has non-environmentally friendly products.
• Globalization makes it difficult for the company to adjust its offer to culturally diverse nations. (Source 1 corroborated by Source 2)
• Changing the offer to the healthier one brings more costs.
• Second Cup has a complicated supply chain and if any part of the chain fails that could mean more problems.

TIM HORTONS

• Tim Horton is a Canadian Coffee chain which has headquarters in Oakville, Ontario, Canada and over 4000 restaurants in 9 countries. The brand is owned by Restaurant Brands International which also owns popular restaurants like Burger King and Popeyes.
• The company's mission is to provide superior quality service to the customer.
• The Tim Horton company sales grew by more than 2% but it still lagged behind the other company brands owned by Restaurant Brands International Inc., The Parent company 'Restaurant Brands International' had shown 87% profit.

• Authenticity: As per marketing SWOT analysis Tim Horton is always voted as the most authentic brand in most surveys.
• Goodwill in Canada: Many people in Canada prefer this brand and are loyal to Tim Horton.
• Pricing: The pricing of Tim Horton coffee and products is less compared to its competitor Starbucks.
• Reward Program: The company provides many reward program the latest one is to provide customers a coffee, tea or select baked goods after seven purchases.

• The company is currently targeting the Chinese market but are facing a major competition from Starbucks which is already operating in China for two decades.

• The company is trying to deliver food and have started to test delivery in three cities.
• They are also planning for children menu's and more loyalty programs.
• All day breakfast program: In this program the company is planning to provide breakfast anytime.
• Also, the company is investing $100 million in Canada to improve the supply chain and is building new distribution centers in Alberta and British Columbia.
• New look and feel across the board: The company's hockey card program was a huge success. The video was viral has 270 million media impressions in Canada and the U.S. and has more than 1.5 million views on Facebook based on which a hockey theme doughnut box was introduced.

• Per the Company CEO: an outdated roll-up-the-rim-to-win promotion had a negative impact on sales.
• Completion from other major companies and increasing health concerns among customers are some major threats the company faces.
• Increasing pay rate for the employees affects the profitability of the company.

STARBUCKS

• Starbucks is a massive coffee chain. It has headquarters in Seattle, USA with over 29,324 stores worldwide. It has 277,000 employees as of 2018.
• The company's vision is to make Starbucks the premier purveyor of coffee in the world.
• Starbucks' 2018 market capitalization was $81.06 billion. Its annual revenue was $24.72 billion and the profit/net income was $4.52 billion that year.

• Brand Name: The company has the most popular coffee brand name around the world.
• Extensive international supply chain: the company has an extensive supply chain. Suppliers are selected based on quality.
• Financial Performance: The company has a strong financial performance. It has increased its profits consistently, and now has a market capitalization of $81.06 billion in 2018.
• Acquisitions: The company has acquired Seattle’s Best Coffee, Teavana, Tazo, Evolution Fresh, Torrefazione Italia Coffee, and Ethos Water.

• The company maintains a focus on customers between 25 and 40 years old with high incomes and the secondary focus is on people belonging to affluent families and between 18 and 24 years old.
• Starbucks target market is middle- to high-income office workers.

• The company has its own app for customers in Canada.
• The company has loyalty programs in Canada.
• In US, customers prefer cold brew so the company is planning to shift its strategy towards cold beverages.
• The company is planning to open 3000 stores in China and 10 more stores in India.
• The company is planning to expand its delivery pilot program. Currently the delivery pilot expansion works in partnership with Uber Eats in San Francisco, CA.
• In Japan, Starbucks is planning to introduce promotions and mobile order and pay technologies. Also in partner with Uber eats, the company is planning to provide a delivery option.
• The company opened the second signing store in Washington, D.C. and has more than 50 military family stores in US.
• The company is adhering to a Go Green concept. The company has launched a NextGen Consortium program and is looking at new cup technologies with an eye toward sustainability goals on a global scale.

• The biggest threat would be competitive low cost coffee sellers and coffee chains.
• Another major threat takes the form of competitive imitation by the other coffee brands.
• Many sociocultural movements support small independent and local coffeehouse and they oppose to franchises.

BLENZ

• Blenz opened its first coffee shop in 1992 on Robson Street in the heart of downtown Vancouver.
• The company's is passionate about giving back to the society like in 2018 it has made 100% donation of drip coffee sales to breast cancer research.
• It has over 82 franchises in 6 countries.

• Extensive menu: The brand provides an extensive menu, individually crafted coffees, and proprietary teas.
• Free Internet: It provides free internet in 41 coffee house locations.
• Talented baristas: It has baristas since the drinks are individually crafted to meet customers' needs.

• The company continues its expansion in Canada and looking for a good franchising partners.

• They have a lot of community partners. Some of which are the Canadian cancer society, Canadian mental health institution, Canadian Red Cross, etc. Though these partnerships, the company engage in numerous charitable projects that impact the communities and lives of Blenz' customers.
• The company uses Simply Sage accounting technology to improve their financials.
• Giving back to society is one of the company's main charity goals. The company announced plans to donate $20,000 to the Canadian Cancer Society.
• Per the managing director Blenz, the company provides perks such as free pastries and unlimited coffee on Mondays.
• They also started blind taste test campaign for the customers to know more about different flavors of coffee. This campaign was received positively by customers and the customers started changing their preference after the taste test.
• For the health conscious customers, the company has introduced the Turmeric Latte that the company claims has anti-inflammatory properties. These superfood drinks are becoming a growing trend.

• The brand has no clear brand direction and values. Unable to find the middle ground between the brand leaders and people making coffee at home.
• The shops are not available in prime locations.
• Competition from major coffee house since this company has little brand recognition and the company history and background does not weave a clear or compelling narrative.

Research Strategy:

The Coffee Chain Industry in Canada

• Coffee is the most popular beverage among adult Canadians and is more popular than tap water. Approximately 67% of Canada’s adults drink a minimum of one cup of coffee and on average three cups per day. Most people consume coffee at breakfast (80%).
• Canada's coffee chain industry consists of 7,583 coffee-shop enterprises which employ 166,196 people and has a total revenue of $11 billion. Between 2012 and 2017 this industry had an average annual growth of 5.7%.
• Currently, Tim Horton has 3,692 locations across Canada, which comes down to approximately one location for every 9,000 Canadians.

KEY TRENDS

Many Chains Are Offering Espresso-Based Beverages

• Espresso-based drinks are increasing in popularity in Canada. According to the Coffee Association Canada (CAC), the percentage of Canadians between 18 and 79 years "who drank an espresso-based beverage in the past day increased from 13% in 2013 to $23% in 2017."
• Espresso is a denser brew of coffee and latte, cappuccino, macchiato, mocha, and Americano are examples of beverages that are considered to be espresso-based drinks.

Differences in Consumption Patterns Between Age Groups

• In Canada, coffee consumption trends in Canada are heavily influenced by the younger generation.
• Adults in the age group 18-49 years have a preference for specialty coffee while adults in the age group 65-79 years prefer traditional coffee. Consumers in the age group 18-34 year find it important that coffee is ethically sourced while older generations find this less important. This has resulted in "a rise in fair trade and organic coffee in local coffee shops."
• According to a study by Nielson, 64% of millennials drink at least one cup of tea per week, compared to 55% of the general population.

THREATS

Competition

• The industry is very competitive with large names like Starbucks and McDonald’s that offer premium coffee experience.
• For example, McDonald’s brand McCafé "has positioned itself as the place to find high-quality but affordable coffees."
• Other major competitors include Tim Horton, Subway, Taco Bell, and Burger King.

Market stagnation

• The market seems to be stagnating. According to analysts, the market is mature and increasing consumer traffic in this market will be increasingly challenging.
• Operators will be successful if they can offer "added value in the form of a premium product and/or consumer experience."
• "Furthermore, there is a (small) chance that increasing consumer debt could impact the overall demand for the services this industry provides."

RESEARCH STRATEGY