Case Analysis - The Red Crab Group - Camille A. Dela Cruz

ENTREP S20

Mr. Jorge Saguinsin

Case Analysis – The Red Crab Group

Camille A. Dela Cruz

I.               Situation Analysis (Relevant Facts)

·       The first restaurant established by Raymond Magdaluyo’s mother and him in Mimosa Pampanga – Red Crab Seafood and Steaks, was very successful despite of no market/ research study.

·       The family of Raymond Magdaluyo adapted the same planning and execution (no market/research study) when they took the opportunity to open a restaurant in Malate.  

·       When the sales significantly declined in the Malate restaurant, it pushed Raymond to do a market research study both in the Alabang and Tomas Morato restaurant. This is to identify who are the customers the restaurant truly caters, to identify what is the real positioning of the restaurant  and to recalibrate his menu to follow his new positioning.

·       Raymond brought his new learning when he was given the opportunity to open a restaurant in Greenbelt 3 – do a market research study before entering into a new venture.

·       The Seafood Club success story was not only because of the food but also because of the experience that comes with it. The restaurant sold its crabs with all the complete paraphernalia.

·       Raymond was again given an opportunity to open a restaurant in Rockwell Power Plant Mall, and he again did a market research study and at the same time used his learning in The Seafood Club, which is not only to sell food but also sell the whole experience. He focused on these four experiences; liberating, enchanting, fulfilling and transformative.

·       His last seafood restaurant concept – The Blackbeard’s Seafood Island, focused on the target market that was identified in the market/research study Raymond did.

·       All of Raymond’s successful restaurants were due to all his learning from his past experiences but also from what he learned in AIM which focusing on a single product, multi concept approach. He focused on seafood but used different restaurant concepts and formats.

·       He also used his most enlightening marketing lesson in AIM, which is the importance of creating his own segment, and to own this segment, he had to define it in finer detail the elements in that segment. He adapted this learning by making all the elements of his restaurants work around the concept/position he has placed.

·       Raymond believed that change is inevitable so he opened up a different restaurant concept which is Heaven N’ Eggs.

II.              Problem Analysis

I believe that the main problem of Raymond was he ventured into the Malate business without doing what was vital and important before starting a business – do a market/research study. The lack of the study reflected on the significant decline of the Red Crab Seafood and Steaks in the month of April. When he started to plan his execution and thoroughly did a market/research study it definitely turnaround the business in Malate, Alabang and Tomas Morato and eventually led to the success stories of his other restaurants. 

III.            Alternatives Generation

Of course there were several alternatives to be done to address the problem Raymond was encountering.

A.     First alternative, he can create a market research study to identify who are the customers the restaurant truly caters, to identify what is the real positioning of the restaurant and to recalibrate his menu to follow his new positioning.

B.     Another alternative is to create a different concept restaurant other than seafood. This concept could be more adaptable to the Malate target market.

IV.            Decision Analysis (Deciding on best alternatives)

In my opinion, it is important to do a market/research study before entering a business venture. The importance of a study is to identify all elements – goal, objectives, concept, positioning, target market, location, pricing strategy, promotion and advertising strategy and staff, needed to identify to create a business that will definitely work and live for a long time. Market/research study is equal to planning and planning is vital to make an execution work perfectly. Planning gives the person a view of the new business as a whole and prepares the entrepreneur for any possible failure. This view provides the entrepreneur to address the seen potential problems and gives him/her to avoid such.

V.              Action Analysis

The decision was definitely the best decision Raymond could have done. In the case, he took time to do a market/research study before his business would fail in Malate. The market researched helped him identify what was wrong in the business. He then created strategies that will help fix and solve the problems of the business, which eventually led to the turnaround of the business. He used the learning in the Malate case and started to plan and create a market study first before venturing into the opportunity presented to him. This led to the other success stories of his businesses.