Industry

1.       Industry

There are three major industries related to our business, which are information technology, restaurant service and staffing industries. Since the restaurant staffing system require a high interaction with end customers, software developers, social media sites and staffing companies. We have carefully measure all relative perspectives in order to define the market and thereby identify the potential opportunities that we can take advantage of to create our venture.

Information Technology

First of all, in order to under the market, we have to analyze the three industries in terms of their history, trend and future growth possibilities. Specifically, by identifying and understanding the overlap areas of these three industries, which is the combination of those three industries’ characteristics, will help us better prepare the startup of the business and give us a brief anticipation of the growth of this specific market. I believe the most important industry that we should put most effort on to analyze is the information technology and software industry because it is essential to the successful of the system.  In today’s world, software cannot survive as they did in 1980s unless aggraded with social medias such as internet, cellphones, TV and multi-media. Interactive designs make the interface of the software look more beautiful and user friendly.  Nowadays, people do not call the functional programs software in most cases, instead, they call them systems.

IT can be used to perform multiple functions and therefore easy to modify and create new functional systems. A system may contain a lot more components than single software. It may include software, hardware, logics, network and documentations. The most popular system in the global market is the expert system which enables people to dynamically manage their business or transactions using these system to help them to do calculations, schedule appointments, monitor performance, share information and even generate new ideas. Another popular system which we also need to take into consideration is the knowledge sharing system which enable people within a scope of business share their ideas and knowledge with each other. The examples of these systems are go-to conference, which gives the business a powerful function to hold meeting with their divisions in different physical locations; forums, which helps people share thoughts and ideas to each other; google wave, which is a powerful communication system gives individual and organization the ability to share document in real time. Etc.

All these systems and new innovations have one similarity which is the trend of improving the communication between people. Thomas Friedman said in his book The world is flat, “Never before in the history of the planet have so many people – on their own – had the ability to find so much information about so many things and about so many other people”. The world is indeed flat and the distance between people should also become closer and closer because of the use of such fantastic communication systems based on information technologies.  In regard to our idea of running a restaurant scheduling system, there is a huge need for the owners of the restaurants as well as the employees to build a better communication channel. And the fast developing of restaurant industry also provide us an opportunity to provide such service to help them save money, improve inner collaboration and become competitive in the future.

Restaurant industry

According to US Department of Labor, a series of investments totaling more than $7.8 million to address the workforce needs of the information technology industry has been made. The need for today’s business to improve employee’s ability to use IT product within their employment scope is increasing dramatically. From the view of profitability, the National Restaurant Association 2010 Industry Report said “industry sales are projected to reach a record $580 billion in 2010, a 2.5 percent increase in current dollars over 2009 sales, according to the National Restaurant Association 2010 Restaurant Industry Forecast. The Forecast projects sales for nearly 40 different industry segments”. A potential growth of restaurant industry and a threat of recession of the global economic will effectively boom the restaurant industry and since jobs are hard to find, more people will start thinking about open their family business such as a small size restaurant.

In addition to the big growth of the industry as a whole, there are three other trends that are in favor of our business. First, there is a great competition exist within the restaurant industries. Even though the industry is growing, there are never enough customers to fill all the tables. In order to reduce the cost of operation, restaurant owners tend to reduce the employee/store ratio to gain higher profit. And the easiest way for them is to import the information management system. Second, since the demand of restaurant service is fluctuate impacted by seasonal affecters, the owners prefer to maintain a large proportion of their employee pool as part-times.  It can both reduce salary cost and effectively control busy seasons.  However, the scheduling to these part time employees are hard because they all have multiple jobs or working as full time somewhere else. To efficiently make every person engaged is a very time consuming and costly task for the restaurant managers. Third, the increase of the diversity of the labor market will also cause headache to the managers. Form The National Restaurant Association's 2010 Restaurant Industry Forecast projects that restaurants will employ 14 million people by 2020, 1.3 million more than today. There will be more potential part time or full time employees come into the market in near future, how to acquire skillful workers and maintain good relationship to keep them work for the restaurants rather than jumping to the competitors side has become a big challenge to the owners as well. Therefore, the demand form the restaurant owners to build a communication channel and recruit qualified employees also offer us the opportunity to create a IT system to help them accomplish their goals.  Additionally, series restaurants such as wendy’s, McDonload’s and KFC also need to build their own inner communication system for HR managers to better handle employment issues.

Staffing business

Historically, staffing company successfully placed millions of people into temporary position.  According American Staffing Association, in the US, staffing companies placed about 2.96M people per day and the total US market generated $91B in 2007 and 80% of the revenue is generated from temporary positions. However, the growing is slow due to the low growth rate and bad economic.  However, that trend on the other hand provide us an bargaining asset to negotiate with the staffing companies and build partnership with them to effectively link the increasing requirement of labor from restaurant industry to the decreasing demand of labor in staffing industry. And by sharing the database with the staffing companies, it is much easier for us to start the business and interact with the labor market.

                 

Nevertheless, staffing industry will not be our focus because there is a potential risk that we may enter into the same area and become competitors with those staffing companies because one our system’s proposed function is to enable the restaurant owner get in touch with local labor market and that may result a interface with staffing companies and reduce their market share.

Summary

               

                To sum up, these three industries’ common area creates the unique market and a great opportunity for us to enter and get profit from.

There are opportunities existed in this structure:

1.       The need to manage restaurant employee’ working time

2.       The need to reduce employee number and increase their productivity

3.       People’s education of using IT products

4.       Well-developed technologies, network and IT devices.

5.       Potential partnership with staffing companies

6.       Part time to fill peak hours

7.       Unique market with less competitors but huge growth

8.       The local labor’s need for jobs in restaurant industry

Base on the analysis. We can clearly see that there does exist many opportunities that allow us to enter the restaurant scheduling system market as a social media company. The market is young and less educated.