Wendy’s SWOT Analysis & Recommendations

Wendy’s SWOT analysis, strengths, weaknesses, opportunities, threats, internal and external strategic factors, recommendations case study
A Wendy’s restaurant in New York City. Wendy’s SWOT analysis shows that the company is strong and competitive, but must diversify and globally expand. (Photo: Public Domain)

Wendy’s potential for international growth can be evaluated through a SWOT analysis. The SWOT analysis is a means of understanding the influences of internal and external strategic factors on the company. In the case of Wendy’s SWOT analysis, the considerations have a global span since the company has international operations. As one of the major competitors in the global fast food restaurant market, Wendy’s SWOT analysis also sheds light on the conditions of the industry, especially the competitive landscape and how other firms fare. At present, the company effectively addresses the main issues facing the business. However, as shown in this SWOT analysis, Wendy’s can improve through more aggressive international expansion.

Wendy’s SWOT analysis reflects the company’s ability to continue its stable growth in major markets. Global expansion can boost the company’s performance.

Wendy’s Strengths (Internal Strategic Factors)

Wendy’s strengths are based on the company’s continuing progress in the fast food restaurant industry. This part of the SWOT analysis considers the internal strategic factors that make the company competent in its business. Wendy’s most notable strengths are as follows:

  1. High quality products
  2. Extensive experience in the business
  3. Strong brand image

The company is known for high quality products. Quality is emphasized in Wendy’s mission and vision statements. For example, the square-shaped hamburger patties are marketed as freshly prepared beef. In addition, Wendy’s has developed into an effective business because of its experience since it was founded in 1969. Also, as one of the top players in the global fast food restaurant market, the company has one of the strongest competing brands. In this part of the SWOT analysis, Wendy’s has the strengths needed to maintain competitiveness.

Wendy’s Weaknesses (Internal Strategic Factors)

Wendy’s weaknesses are linked to its current condition relative to other large fast food firms. The internal strategic factors that limit business development are considered in this part of the SWOT analysis. The following are Wendy’s main weaknesses:

  1. Limited global reach
  2. Low diversification
  3. Imitable products

Most of Wendy’s revenues are generated in North America. The company’s financial reports indicate that its revenues from other regions are “immaterial.” This condition is a weakness because it prevents Wendy’s from maximizing its performance in the global market. Also, the company has limited diversification, which is reflected in the lack of major product or business innovation. Another weakness is that many of Wendy’s products are imitable. Smaller firms, especially in developing countries, can copy Wendy’s products. Based on this part of the SWOT analysis, Wendy’s weaknesses limit business growth at the international level.

Opportunities for Wendy’s (External Strategic Factors)

Wendy’s has opportunities to significantly increase its business performance. This part of the SWOT analysis focuses on the external strategic factors, such as industry conditions, that lead to business improvement. The most notable opportunities for Wendy’s are as follows:

  1. Global expansion
  2. Business diversification
  3. More aggressive product innovation

Wendy’s has the opportunity to expand internationally. Global expansion can increase the company’s market reach and boost its finances. Wendy’s also has the opportunity to diversify its business. For example, the company can acquire complementary businesses in the food service industry, or develop an entirely new line of products. In relation, Wendy’s can innovate more aggressively to increase its competitiveness against firms like McDonald’s and Burger King. This part of the SWOT analysis indicates that Wendy’s has significant opportunities for global growth.

Threats Facing Wendy’s (External Strategic Factors)

Wendy’s must counteract threats to its business. The external strategic factors that reduce business performance are identified in this part of the SWOT analysis. The following are the main threats against Wendy’s:

  1. Aggressive competition
  2. Imitation
  3. Healthy lifestyles trend

Aggressive competitors threaten Wendy’s business. For example, McDonald’s is aggressive in marketing and global expansion. Also, imitation is a threat that could reduce the competence and attractiveness of Wendy’s products. Moreover, an increasing level of health-consciousness could reduce or dampen demand for products from firms like Wendy’s. As shown in this part of the SWOT analysis, Wendy’s must improve its products and competitiveness to address major threats to its business.

Wendy’s SWOT Analysis – Recommendations

Wendy’s is among the top companies in the global fast food restaurant market. As presented in this SWOT analysis, Wendy’s has the strengths to ensure continued satisfactory performance. However, such performance is limited because the company has not yet taken major action to increase its global presence. Thus, Wendy’s can benefit from a more aggressive global expansion strategy. Also, the company must diversify its business to reduce exposure to market risks, and increase investments for product innovation to address changing consumer preferences. This SWOT analysis highlights the need for reforms in Wendy’s strategies to maintain its competitiveness in the long term.

References
  • Hill, T., & Westbrook, R. (1997). SWOT analysis: it’s time for a product recall. Long range planning30(1), 46-52.
  • Jackson, S. E., Joshi, A., & Erhardt, N. L. (2003). Recent research on team and organizational diversity: SWOT analysis and implications. Journal of management29(6), 801-830.
  • Jacobs, T., Shepherd, J., & Johnson, G. (1998). Strengths, weaknesses, opportunities and threats (SWOT) analysis. Exploring Techniques of Analysis and Evaluation in Strategic Management. London: Prentice Hall, 122-133.
  • Leigh, D., & Pershing, A. J. (2006). SWOT analysis. The Handbook of Human Performance Technology, 1089-1108.
  • Pickton, D. W., & Wright, S. (1998). What’s SWOT in strategic analysis?. Strategic change7(2), 101-109.
  • Piercy, N., & Giles, W. (1989). Making SWOT analysis work. Marketing Intelligence & Planning7(5/6), 5-7.
  • The Wendy’s Company, Form 10-K, 2013-2014.
  • Valentin, E. K. (2001). SWOT analysis from a resource-based view. Journal of Marketing theory and Practice, 54-69.
  • Wendy’s International, LLC, Form 424B3, 2001.
Tags:


COPYRIGHT NOTICE:
This article may not be reproduced, distributed, or mirrored without written permission from Panmore Institute and its author/s. Copyright by Panmore Institute - All rights reserved. Small parts of this article may be quoted or paraphrased for research purposes, as long as the article is properly cited and referenced together with its URL/link.