Wendy's And The Fast Food Industry

9 Pages 2266 Words

ant menus. A demographic threat is the slowing of United States birth rates, which could affect how restaurants market to children. Also related to demographics are socio-cultural factors that influence this industry. A socio-cultural opportunity is the fact that Americans increasingly love to eat out. According to the U.S. Department of Agriculture, in 1960 only 26.3% of food consumption took place away from home, but by 2002 that number has increased to 46.1% (“Industry Surveys,” 2003, p. 9). A socio-cultural threat that could change the way many fast food restaurants do business is the recent heath food craze. This threat is so big it may make or break many of the biggest fast food restaurants in the coming years.
Economic factors should be looked at closely in the restaurant industry because when the economy does well, people have more disposable income that many use to eat out. A big economic opportunity is the current economic recovery, which should help out many restaurants. Another economic opportunity is the increasing disposable income of Americans. From 1997 to 2002, U.S. disposable income has had an annual growth rate of 2.3% (“Industry Surveys,” 2003, p. 9). An economic threat is as Americans become wealthier, they may chose to eat at restaurants that are full service rather than fast food. Closely related to economic factors are global factors. A great opportunity for global growth would be Asia where there is still much money to be made through expansion. A global threat is the recent banning of Canadian beef to American restaurants because of a reported case of mad cows disease (“Industry Surveys, 2003, p. 1). This threat will raise commodity costs for many restaurants.
Three final external factors are legal, political, and technological. Related to the current health food craze, certain legal factors threaten the fast food industry. The biggest threat has come from recent lawsuits filed on ...