Sentrep CASE ANALYSIS: The Red Crab Group – Kevin Toledo

CASE ANALYSIS: The Red Crab Group – Kevin Toledo

Situation Analysis – Relevant Facts

Red Crab Group started from the first restaurant opened by Raymond’s mother in 1998 at Clark, Pampanga. Red Crab eventually expanded to Metro Manila and has been successful in developing its business of chain of restaurants.

 1998: Raymond’s mother opened the Red Crab & Sea Food Restaurant at Clark, Pampanga in the Mimosa Leisure Park. The price of the food was in the high end as its market was golfers, casino players and high rollers.  

1999: Red Crab and Seafood Steaks was opened at Malate. There was no market research done and sales went below 30% 

2001: Red Crab Seafood & Steak at Tomas Morato was opened where surprisingly it captured the “celebrities” as its market.

Another Red Crab and Seafood & Steaks branch was opened at Alabang. This time, Raymond started to do market research. In this venture, he realized that his market was in the 26-35 years age bracket. He then adjusted the ambience of the Alabang & Morato branch to fit younger crowds. 

Raymond also did repositioning of the brand where he downplayed the Filipino branding and focused in the “International seafood restaurant feel”. He also recalibrated the menu.

2003: Seafood Club was opened at Greenbelt 3. This required Raymond to develop a new concept where the restaurant was intended to be a happy place to entertain customers.

2004: Crustacia was opened at Rockwell. Raymond was also required to develop a new concept for this restaurant where he focused on the restaurant to be Asian themed fine dine. Raymond did an intensive product development & market research in order for the restaurant to be aligned in it concept. Crustacia  was awarded later the “Best Asian Restaurant in the Philippines”.

2005: Blackbeard Seafood Island was opened with a concept of being an “inuman place” for the young professionals who would like to unwind to have a good dinner and a couple of beers after a tiring day from office.

2005: Heaven n’ Eggs was opened at Tomas Morato. This concept was entirely different as it deviated from the original seafood theme of Red Crab.

Raymond was very successful in expanding the business of Red Crab by capitalizing in his mastery of identifying market & what he is selling – Single Product, multi-concept approach.

        

Problem

The problem is business growth and sustainability as Red Crab had been known in developing new concepts where the brain is actually Raymond. Red Crab group must be able to find a way on how they could sustain developing new concepts the way Raymond did.      

Alternatives

1.    1. Red Crab Group will hire internally product development experts.

2.    2. Red Crab Group to create a product development team within their organization which will develop a list of different new concepts they could offer to lessors.

3.    3. Red Crab Group must stick to the single product-multiple concept approach, and relinquish their ownership from non-seafood related products.  

4.    4. Red Crab Group will just have to focus on the restaurant brands they have developed

5.    5. Red Crab Group to keep its position and further develop their management team by investing in trainings in order for the Group to be independent from Raymond in terms of developing new concepts.

Decision

Alternative #3 would be the soundest decision I can think of. Red Crab Group, having its “mother brand” already developed, must just focus on the single product multiple concept approach. They have already created a market for their brands related to seafood and have proven their mastery on that approach. All they need is to do is focus on expanding the market they have created and just further improve the brand. Red Crab Group has been known to be a chain of seafood restaurant concepts and they must maintain to capitalize on it and further improve on it.

      

Action Analysis

Raymond was successful at developing Red Crab as a company with a chain of different seafood restaurant concepts. However, I think he made a wrong decision with the latest move he has done for the company where he ventured into an entirely new concept and deviated from the seafood theme, most especially taking into consideration that the name of the Group is clearly associated with seafood.