Our Chick-fil-A SWOT analysis investigates the Strengths, Weaknesses, Opportunities, and Threats of one of the leading fast-food outlets in the U.S.
When I say "Chicken Sandwich," what comes to your mind? Like, apart from juicy Chicken stuffed between a fresh pair of buns along with some tasty sauces, what else? Did you say Chick-fil-A? Well, that makes sense. Chick-fil-A is one of the leading fast-food outlets that mainly serve Chicken Sandwiches across the U.S. and in some other countries.
Looking at how Chick-fil-A has successfully managed to become a household name in the past 54 years, we feel the need to carry out a Chick-fil-A SWOT analysis to see the strengths, weaknesses, opportunities, and threats present for Chick-fil-A today. Also, make sure to check out our PESTLE analysis of Chick-fil-A.
Close your eyes and imagine a world without Chicken Sandwiches for a moment. It looks pretty unrealistic, right? But guess what, till 1946, the world existed in the absence of Chicken Sandwiches. Then in 1946, a guy named Truett Cathy in Atlanta started making and selling Chicken Sandwiches in his small restaurant for the first time.
You must be thinking, "What does the history of Chicken Sandwich have to do with Chick-fil-A?" Well, I'll answer that. After the Invention of the Chicken Sandwich, Truett Cathy named his Chicken Sandwich "Chick-fil-A". Then, after his "Chick-fil-A" gained popularity, he decided to open the first Chick-fil-A restaurant two decades later in 1967.
I am sure all of you reading this would be thankful to Mr. Truett Cathy for his invention since no one would ever want to live in a world where there are no Chicken Sandwiches. Although Truett Cathy invented the Chicken Sandwich way before he opened the Chick-fil-A restaurant, Chick-fil-A takes the credit for inventing the Chicken Sandwich. Chick-fil-A also used this point for its marketing by chanting the slogan "We didn't invent the chicken. Just the chicken sandwich.".
Chick-fil-A is a success story. Even after running for more than five decades, Chick-fil-A is still giving a tough time to some gigantic fast-food competitors such as Mcdonald's and KFC. Chick-fil-A is considered a market leader in the U.S. regarding fast food. According to the orders placed online in 2019 and 2020, Chick-fil-A held 45% of the Market share in the U.S. which showed its dominance over the rest of the fast-food chains.
Over the years, Chick-fil-A managed to spread to 47 states of the U.S., including Washington D.C. To study the phenomenon behind such exponential growth and identify the hurdles that this food chain might face in the future, we will conduct a SWOT analysis on Chick-fil-A. Before moving further, let me briefly explain to you what SWOT analysis is.
Okay, relax. Don't worry; I will not start a lecture on business studies over here. SWOT analysis may sound like something very complicated because of its name, but actually, it is a straightforward concept to understand. So let me start by breaking the word "SWOT" so you can understand what it means.
The S in the word SWOT stands for strengths, whereas W represents the weakness an organization possesses. Strengths and weaknesses are the internal factors of an organization. Meanwhile, O in the acronym SWOT is for opportunities, and T highlights the threats an organization would face in the future. Opportunities and threats account for external factors which can affect the organization.
A SWOT template includes both internal and external factors that provide a complete picture of the organization, depending upon which it makes business policies and strategies. To better understand the SWOT analysis, I'd recommend you go through some of the SWOT analysis examples before you scroll any further.
Strengths That Made Chick-fil-A Market Leader
Strengths account for internal factors due to which an organization can grow. Factors that count as strengths help an organization increase its market share and consolidate its position in the market. In this section, we have mentioned some of the strengths that helped Chick-fil-A is dominating the market for the last five decades.
Customer Service
Have you ever been to a restaurant with tasty food, a pleasing ambiance, and poor customer service, which disappointed you? I am sure you have. Good customer service is always on top of any consumer's priority list.
Chick-fil-A is known for having very satisfactory customer service. Consumers have named Chick-fil-A the number one food chain in terms of its service and customer satisfaction many times. Satisfactory customer service provides an edge to Chick-fil-A in a highly competitive market.
Variety Of Products
Of course, Chick-fil-A is famous for its sandwiches, but the variety on its menu is also a source of attraction for customers. Apart from serving top-quality sandwiches, Chick-fil-A also has a variety of salads on its menu. Besides sandwiches and salads, Chick-fil-A waffle potato fries also attract many customers to the restaurant.
Moreover, Chick-fil-A also serves a variety of cold and hot drinks. Chick-fil-A also suits the customers who have a sweet tooth as it offers several sweet desserts and milkshakes. Chick-fil-A is also uniquely famous for its diverse range of sauces. Recently, Chick-fil-A decided to launch its sauces as individual products, turning out to be another source of customer attraction.
Image Of The Brand
A brand needs to have a positive image. To some extent, it is true that in a market, consumers only look for the best quality product at a reasonable price, but subconsciously the image of the brand also matters. Customers tend to buy more from a brand that has a positive image.
If we talk about Chick-fil-A, we can say that the image Chick-fil-A carries is very positive. Chick-fil-A believes in giving back to society by contributing to the environmental sector, feeding people, helping the community, and treating their customers right.
Digital Orders
Growing technology has made life a lot easier. Businesses have made good use of the technology to maximize their profits. Chick-fil-A also uses the technology of placing orders online to maximize its share in the market. After the digitization of orders, almost 20% of sales of Chick-fil-A are made by online orders. By adopting digitization, Chick-fil-A has made it easier for customers to order.
Weaknesses Of Chick-fil-A
Weaknesses in a SWOT analysis account for internal factors which the organization lacks. Once these weaknesses are identified, then they can be transformed into strengths later.
High Competition
Although a high level of competition drives businesses to give their best in the market so that they can grab the maximum market share. In some cases doing business in a highly competitive market becomes difficult.
There are 50,000 food chains working in the U.S. along with Chick-Fil-A, due to which market share divides between the food chains. Other than that, Chick-Fil-A has to give its best every day since a small mistake could lead to a loss of market share as there are a lot of substitutes present that could replace Chick-fil-A.
Limited International Geographical Presence
Businesses are always looking to open their outlets internationally once they are recognized domestically to dominate the international market as well. Despite being the market leader in the U.S., Chick-fil-A chose not to expand internationally.
Until 2019, operations of Chick-fil-A were restricted to the U.S. Later, they decided to open in Canada and the U.K. These self-imposed restrictions stopped Chick-fil-A from capitalizing on international market share.
High Prices
Consumers are always looking to get their desired products at a low price. For example, suppose I tell you that two restaurants are selling cheeseburgers, and one of them is selling them at half-price. Wouldn't you be automatically more interested in the cheaper cheeseburger? Who wouldn't want to consume a cheeseburger while saving money for dessert?
Chick-fil-A is slightly expensive compared to other fast-food chains in the U.S. Although Chick-fil-A claims that they charge a bit extra because of their high quality, high prices still have a drawback for Chick-fil-A since customers then look for its alternatives.
Too Much Chicken
I personally love eating chicken, but many people don't consume chicken at all. The variety of meat on the menu can help in engaging customers who consume different types of meat.
Chick-fil-A's menu consists of chicken sandwiches only. That would mean they might be missing out on consumers who prefer other meat options over chicken-only options. Since Chick-fil-A only provides chicken products, this narrows down the market share of Chick-fil-A.
Though, as reported there are 12 known Chick-fil-A branches offering beef items.
These beef options were a part of the "original menu" and are still kept on the menu by Chick-fil-a's previously discussed 12 branches, solely to preserve their origins.
Opportunities for Chick-fil-A in the future
Opportunities account for the upcoming chances, which are cashed in the future if they are availed at the right time.
International Expansion
Chick-fil-A has grown across the U.S. but lacks internationally. Although now they have started to expand internationally as well, they are only operating in 3 countries. However, great potential lies ahead for Chick-fil-A to spread across the globe and maximize its market share in the global economy.
Use Of Social Media And Digital Marketing
Although Chick-fil-A dominates the U.S. fast-food market, there are still plenty of growth opportunities. Chick-fil-A can use technology for its growth. With the help of digital marketing and social media, the customer base of the food chain can be increased.
Opening On Sundays
Many things have changed in five decades except the policy of Chick-fil-A to remain closed on Sundays. Although their religious beliefs back this decision, each year, the loss incurred to Chick-fil-A is around $1 billion by staying closed on Sundays. This loss can be converted into profit if Chick-fil-A remains open on Sundays.
Threats For Chick-fil-A
Threats in SWOT analysis are accounted for the external factors which create hurdles in the growth of an organization.
Introduction Of New Products By Competitors
Over the years, Chick-fil-A decided to mainly stick with the product they are good at making, sandwiches. On the other hand, its competitors like McDonald's developed a diverse product range from burgers to sandwiches, desserts, shakes, bakery items, and wraps.
Even now McDonald's and other competitors are developing new products every other day. This will provide them an edge over Chick-fil-A, as a result, Chick-fil-A will lose its market share.
Healthy Diet
Compared to the past, people are now more aware of what to eat and what to avoid. People's choices have shifted towards a healthy diet over fast food and junk food, primarily due to Covid-19.
It can be further predicted, looking at the outbreak of new diseases that in the future more people might shift towards a healthy diet. If that happens, Chick-fil-A will lose its significant share as it is mainly famous for its Chicken sandwiches which are not healthy food.
Chicken Related Infectious Diseases
Chicken lovers always seem to be worried about Chicken related diseases such as bird flu, since such infections disrupt their consumption of Chicken and also spread diseases among people.
Infectious diseases such as bird flu will harm Chick-fil-A, since Chick-fil-A primarily produces chicken sandwiches, disruption in the supply of Chicken can cause serious supply chain problems for Chick-fil-A.
Other than that, Chicken related infectious diseases will discourage the consumption of Chick-fil-A's chicken sandwiches, resulting in a fall in profits.
Chick-fil-A SWOT analysis: Final Thoughts
In this article, we conducted a SWOT analysis on one of the most famous fast-food chains in the U.S., Chick-fil-A. This SWOT matrix helped us to analyze what strengths does Chick-fil-A possess, and what are the weaknesses to be transformed into strengths shortly. It also highlights the opportunities and threats to be faced by Chick-fil-A.
This article provided insight into both internal and external factors that are important for Chick-fil-A to keep in mind before making any business strategies. Still, it also made you aware of how to conduct a SWOT analysis.
