Name of Module: Principles of Economics (FNBE0315)
Report Title: A Tale of Two Businesses – A Comparative Analysis of 2
Businesses of Similar Industry in Different Geographical Locations
Group Members: Haziq Zariful(0314131)
: Syafiq Zariful(0314702)
: Cassandra Wong (0313365)
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Table of Content
Content Page
Cover page 1
Table of Content 2
Key Summary 3
Brief Bio of Businesses 4-5
Comparative Analysis of the Businesses’ Competitive Traits 6-11
Recommendation 12
Appendices 13-46
References 47-48
Key Summary
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We were given an assignment to compare the analysis of two
businesses of similar industry in different geographical locations. We
chose to compare businesses in Penang and in Klang Valley on seafood
restaurants. The seafood restaurant we chose in Penang is Bali Hai
Seafood Restaurant which is located in Gurney Drive and in Klang
Valley we chose Bubba Gump Shrimp Co, which is located in Sunway
Pyramid. After completing and analysis the report, we found out that
Bali Hai would be the more commercially successful business
compared to Bubba Gump. Besides that, the similarity of the two
businesses is that both are having monopolistic competition.
Brief Bio of the Businesses
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Bali Hai Seafood Restaurant
i. The seafood restaurant interviewed in Penang is the ‘Bali Hai
Seafood Restaurant’ strategically located in the famous tourist
spot for local food in all markets, the Gurney Drive. The
interviewee is the Group Food & Beverage Manager of the
business, Steve Foong.
ii. The first outlet opened for the business is at Gurney Drive, the
second outlet is at Penang Times Square, the third outlet is at
Sungai Pinang and it the biggest outlet so far, the fourth one, is
located at Batu Feringghi.
iii. The business currently has four outlets in Penang and is going to
open the fifth outlet at Damansara.
iv. The product mainly sells fresh seafood in various kinds such as
lobsters, crabs, shrimps, geoducks, cooked in many types of
ways such as steamed, fried, boiled, etc. Popular dishes include:
steamed grouper, curry crabs with rice noodles.
v. The business‘s first outlet opened at Gurney Drive in 6th
December 2005.
vi. The business was founded by Mr. Josh Chua; and
vii. It was founded because of his love towards food & desire to try
on newer types of cooking; he got the inspiration to start this
business during his younger years. He worked with his father
when he was at a hawker stall selling grill fish at Sungai Pinang,
and then eventually passed the grill fish business to his niece to
open Bali Hai Seafood Restaurant. What inspired him to call his
shop ‘Bali Hai Seafood Restaurant’ was because Mr. Josh loves
Bali, and would love to bring a ‘Bali feel’ to their restaurant
where he uses the sunset view, seaside location, tablecloth and
the dry leaf roof imported all the way from Thailand with the
decorations to make customers feel as if they are in Bali.
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viii. In recent times, the business has used their revenue to add
decorations to add a relaxing family atmosphere & also a Bali
feel such as the dry leaf roofing. The revenue is also used to
bring in more sea animals & products to compete with other
competitors. The revenue the business gains through their
development is currently RM1million per month, where they start
the business with a capital of RM600K.
Bubba Gump
i. The seafood restaurant interviewed in Klang Valley is the ‘Bubba
Gump Shrimp Co.’ strategically located in one of the shopping
mall in KL, Sunway Pyramid. The interviewee is the assistant
Sous Chef, Mr. Pravin.
ii. The first outlet opened in KL is at The Curve Mutiara, Damansara.
The second outlet in Kuala Lumpur is at Sunway Pyramid and the
third outlet is at. Citta Mall, Damansara
iii. The business currently has thirty-two Bubba Gump restaurants
operated worldwide. Twenty-two of these locations are in the
United States, three are in Japan, two are located in Mexico,
three are in Malaysia, and one each in the Philippines, Indonesia
and Hong Kong.
iv. The product mainly sells fresh seafood in various kinds such as
shrimp, salmon, fish, lobsters cooked in many types of ways such
as steamed, fried, boiled and more. Popular dishes includes their
award winning Dixie style baby back ribs, traditional shrimp
cocktails, stuffed shrimps with crab meats, shrimp kebab and
more.
v. The businesses opened their first outlet in Malaysia at The Curve
Mutiara, Damansara in 2008.
vi. The business was founded by Viacom Consumer Products
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vii. Was founded because was inspired by the 1994 film Forrest
Gump. The Bubba Gump restaurant is named after the film's
characters Benjamin Buford "Bubba" Blue and Forrest Gump.
viii. Their recent development is that they are going to open their
100th outlet in Malaysia soon.
Video link(Brief Bio of Two Business) - http://youtu.be/qgk_ewJ3su8
Comparative Analysis of Competitive Traits
1) In Penang, in the Seafood Restaurant market, there are at least 49
competitors, specifically in Georgetown; there are approximately 19
competitors in the market.
There is an astoundingly large number of seafood restaurants in
Klang Valley, counting to more than 180 firms. Specifically in
Petaling Jaya, there are at least 50 firms.
2) In Penang, Bali Hai’s market share is small & its top competitors in
the market would be Tan Sam Guan Seafood Restaurant, Pinang
Taste Seafood, and Ocean Green Restaurant.
In Klang Valley, Bubba Gumps’ market share is the same as the
other outlets in Sunway Pyramid & its top competitors would be
Manhattan Fish Market, Pantai Seafood Restaurant & Restaurant
Fatty Crab.
3) Bali Hai:
a) Tan Sam Guan is a seafood restaurant located in Batu Ferringhi
founded by locals Liang & Loon. The restaurant is famous for
their friendly service, atmosphere & their Malaysian Cuisine.
They also serve food other than seafood such as sizzling chicken
& fried chicken with honey.
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b) Pinang Taste Seafood is located at World Heritage Area
Carnarvon Street, Georgetown. Their motto "Local Taste with
Home Sauce Recipe" signifies that they cook their food such as
Nyonya Asam Fish in a local Malaysian way & that all their sauce
are made from traditional home recipe. They are also famous
locally for cheap dishes at an average of RM3.
c) The Ocean Green Seafood is a popular dining place located off
Jalan Sultan Ahmad Shah in the city center. The restaurant also
gives an open view of a popular beach area for couples. The
eatery offers famous seafood freshly caught which are cooked in
various ways such as the Steam Curry Fish, Sweet and Sour Crab
& Scallop Soup.
Bubba Gump:
a) The Manhattan Fish Market would be the largest competitor; one
of the major reasons is that it is also strategically placed in
Sunway Pyramid Megamall like Bubba Gump. Another cause is
how a globally successful company owns the restaurant; hence,
they would have a larger capital, larger suppliers & different
types of recipes such as Fiery Cherry Snapper & Manhattan
Flaming Prawns. Pricewise, customers would ideally dine in this
restaurant than Bubba Gump.
b) Pantai Seafood is situated around wooden houses & light
industrials; however, the interior has a spacious relaxing family
atmosphere. There are cascading tanks with a wide array of
seafood to choose from for a freshly cooked meal. Signature
Dishes include Pak Cheok Har (Poached Fresh Prawns) & Siong
Tong LaLa (Steamed Clams in Superior Soup).
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c) Restoran Fatty Crab had been well established and known to
many people. A Hot spot for Malaysians including Malays as it
had been certified as a Halal restaurant. The business can
obviously be identified as a local business since it resembles a
typical local restaurant, with fans, outdoor tables, local cuisine &
stalls where they cook satay and Chicken wings. Other Dishes
include Sweet and Sour Sauce Crabs & Steamed Fish.
4) Bali Hai:
- The management team would go around the area & eat food
from other restaurants not just in their market to spark ideas on
ways to cook their food.
- The manager also encourages employees to spend time with
their customers & receive negative/positive comments for the
management to reflect on.
- The manager would also discuss with chefs & suppliers every 2
weeks to create a new seafood dish. After discussing, the
business would then promote their new product to their
customers.
- Other strategies include the marketing department running
programs to promote the restaurant such as partnering with
Tourism Malaysia, which sponsors the business through
brochures.
Bubba Gump:
- The restaurant has dancers perform Spanish dancing with the
music in the restaurant as a way to make the restaurant more
unique.
- As a restaurant self-labeled as a family restaurant, the
management allows kids under the age of 12 to eat their
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products for free. This would attract more families, as they would
not want to spend a lot.
- New products are introduced annually in November/December.
- In the marketing department, Bubba Gump promotes themselves
by selling merchandise near their shop, also promoting retro
brands such as Guinness & Tiger.
5) To enter the seafood restaurant market according to both managers
is currently easy as long as there is enough money to start the
business, only a small capital would be needed, eg. Bali Hai only
needed RM600k from their capital. One of the few obstacles faced in
the market pointed out by Bali Hai manager, Steve Foong, is that
businesses need to partner with a supplier & to compete with
others; a supplier who can supply a large variety of seafood would
be needed, however, local fishermen can also provide their services
to local businesses, which would be cheaper. The chefs must also
have the knowledge to cook seafood & furthermore, to compete
against competitors, they need to be innovative on cooking new
products to attract customers.
6) The seafood restaurant market for both Bali Hai and Bubba Gump
has Monopolistic Competition. In a market with Monopolistic
Competition, there are many firms, relatively easy to enter,
somewhat different products, some price difference &
advertisement is important to compete against competitors.
i) In Penang, there are approximately at least 49 firms while
there are at least 50 firms in Petaling Jaya, this proves there
are many firms in the geographical market & that it is easy to
enter.
ii) The market also sells different types of dishes, in order to
compete against competitors, firms like Bali Hai think of a
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new product to sell in a mere 2 weeks whereas the products
of seafood restaurant also varies by their supplier, Bali Hai
has approximately more than 25 different types of seafood in
different types of ways to cook them.
iii) There are also different price differences, local businesses
might hire local fishermen or fish for their supply, which,
compared to large businesses who hires suppliers providing
various types of seafood, would be much cheaper, hence,
their price would also be cheaper.
iv) Lastly, large businesses such as Bubba Gump & Bali Hai would
advertise in order to attract more customers & not lose to
their competitors.
Competitive Traits Bali Hai Seafood
Restaurant (Penang-
Based)
Bubba Gump
(Klang Valley-Based)
1. Number of
Competitors
45-60 firms 180-200 firms
2. Barrier to Entry
Strong, has low capital,
needs to gradually
upgrade firm through
revenue
Weak, has high capital,
located at Sunway
Pyramid, where there are
many people, strong
advertisements
3. Differentiated or
Standardized Products.
Differentiated, eg.
Alaskan King Crab in
Salted Egg Yolk, Cheese
and Crab Meat Whole
Standardized, very few
differentiated products
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Scallop
4. Pricing Power Price Maker - sells various
types of seafood that are
not locally found, such as
Australian Spider Crab &
Geoduck.
Price Taker - few
differentiated products,
some can be cooked at
home.
5. Other
Characteristics
No close product
substitutes around the
area, mutual
dependence, inconstant
advertising
Many Close product
substitutes found nearby,
constant advertising in &
around firm
6. Verdict Monopolistic Competition Monopolistic Competition
7) Comparative Analysis Summary Table
8) Based on our analysis, Bali Hai would be the more commercially
successful business. One of the reasons is that there are too many
competitors in Klang Valley than Penang & because of this, their
advertisements are effective. Another reason is that Bubba Gump
doesn’t give too many unique recipes for their products & takes a
whole year on creating a new product while Bali Hai only takes 2
weeks & have different types of seafood not just sticking to prawns,
shrimp & fish like Bubba Gump.
Video link(Comparative Analysis of Competitive
Traits)-http://youtu.be/saGm2xv1Zd0
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Recommendation
BUBBA GUMP
- The products sold in the firm are too common & can even be cooked
at home or at least can be found in other restaurants in a cheaper
price such as tempura shrimp or fish and chips. There are very few
differentiated products exclusively for the restaurant and also, the
dishes focus too much on shrimp & prawn there are only 4 types of
dishes for fish. Our recommendation is for the company to issue new
products monthly or every 2 weeks, instead of the current annual time.
- The price is a major reason why customers are driven away from the
firm, since there are many competitors who sell substitute products for
a cheaper price. For example, Bubba Gump’s Fish & chips are for
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RM25.90, whereas in Manhattan Fish Market, their Fish & chips range
from RM12.50 to RM19. Aside from food, drinks are only too pricey
ranging from RM12 to RM25. Our recommendation is to sell products
almost equal to competitors where demand can be equal.
BALI HAI SEAFOOD RESTAURANT
-The restaurant is located just by the roadside, which makes it
unhygienic due to the carbon monoxide from vehicles which can affect
the customers eating the food. Besides that, the noise from the
motorcycles that pass through can also disturb the customers who are
having family dinners. Our recommendation is that they cover part of
the restaurant up to maintain the cleanliness and the ambience of the
restaurant.
-The limited parking spaces are also one of the major reasons why
customers are driven away from the restaurant. There isn’t much
parking lots based on what we see when we are there. The reason is
because it is by the roadside and there is moving traffic which makes
customers cannot park by the side. Our recommendation is to provide
parking spaces for the ‘Bali Hai Seafood Restaurant’ customers.
Video link(Recommendation)- http://youtu.be/2GWMKCJs62M
Appendices
BALI HAI:
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Interview notes
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Contact Details (Restaurant):
Address - 90, 90A, 90B, 90C & 90D, Persiaran Gurney
Georgetown
10250 Penang, Malaysia
Contact no. - 04-228 8272
Fax - 04-228 8273
Email - [email protected]
Website - http://balihaiseafood.com
Contact Details (Corporate Office):
Address - 23, Lorong Birch,
Georgetown
10250 Penang, Malaysia
Contact no. - 04-227 3667
Fax - 04-228 3667
Contact Details (Current Manager):
Contact no. - 016-520 3024
016-445 1001
Email - [email protected]
Photos
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Business Premises
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Main Entrance With Sign of Name & Logo
Overview of the Main AreaCascade Tanks With Various Types of Sea Animals
Crabs, Lobsters & Clams placed on ice
Bali Style Huts with dry leaf roofing
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Traditional Decorations under ceiling
The Counter Table
Windows To Witness Behind the Scenes Actions by the chefs
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The Kitchen Utensils Used
The Kitchen
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The Refrigerators & Ovens
Chefs Working In The Kitchen
Products
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Deep Fried Crab
Curry Crab with Rice Noodles
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Steamed Grouper
Seafood Fried Rice
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Bali Hai Waiter serving Coconut
Crab Meat and Cheese in whole Scallop
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Bali Hai Facebook Page
Bali Hai Official Website Home Page
Official Websites & Pages
BUBBA GUMP:Interview Notes
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Contact Details (Restaurant):
Address - Oasis Boulevard, Sunway Pyramid Shopping
Mall, No. 3, Jalan PJS 11/15, Bandar Sunway,
56150 Petaling Jaya, Selangor, Malaysia
Contact no. - 03-5638 4559
03-5635 3559
Fax - 03-5637 6559
Email - [email protected]
Website - http://www.bubbagump.com/
Contact Details (Corporate Office) [Naza Corporation Sdn Bhd]:
Address - -115 Jalan Raja Muda AzizKampung Baru,
50300 Kuala Lumpur
-Lot 1, Jalan 51A/ 22146100
Petaling JayaSelangor, Malaysia
Contact no. - 03-26177999/888
03-79532888
Fax - 03-2681 8928
Website - www.naza.com.my
Contact Details (Manager):
Contact no. - 01-4633 4733
Email - [email protected]
Photos
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Business Premises
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Main Entrance
Promotion outside Entrance to attract customers
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Seating (1)
Seating (2)
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Drink Bar
Bartenders with Beer Dispensers
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Seating (3)
Corner where stocks such as Plates & Cups are placed
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Seating (4) (Outdoor)
2-3 people seating
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Family seating
Promotions & Merchandise Outdoors Employee of the Month Wall
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Employees & Mascot
Merchandise Shop
Marketing & Promotions
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Merchandise Shop Counter
Bubba Gump T-shirts
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Bubba Gump Knick-Knacks
‘Kids Eat Free’ & ‘Free Refill’ Promotion Picture
RM50 Coupon
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“Kids Eat Free’ Promotion to Attract Families
Mother’s Day Promotion
Products
Onion RingsShrimper’s Heaven
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‘I’m Stuffed!’ Shrimp
Jambalaya
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Dumb Luck Coconut Shrimp
Shrimper’s Net Catch
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Mud PieBuffalo Wings
Fried Shrimp
Potato Salad
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Menu
Cover Page Back Page
Specials Menu
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Chicken, Meat, Fish & Pasta Menu
Promotion Menu – Front Page Promotion Menu – Back Page
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Websites & Pages
Official Website – Sunway Outlet
Website – ‘About’ Page
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Official Facebook Page
Restaurant Information from Facebook Page
References
[WEBSITES]
Gomakan.com. (2014). Bubba gump shrimp co. @ sunway pyramid | gomakan. [online] Retrieved from:http://gomakan.com/go/bubba-gump-shrimp-co-at-sunway-pyramid[Accessed: 13 Jan 2014].
Biz.yellowpages.com.my. (2013). Bali hai seafood restaurant. [online] Retrieved from:http://biz.yellowpages.com.my/balihaiseafood/ [Accessed: 13 Jan 2014]. Balihaiseafood.com. (2012). Bali hai seafood market official website. [online] Retrieved from: http://balihaiseafood.com[Accessed: 17 Nov 2013].
Tripadvisor.com.my. (n.d.). Restaurants: find restaurant reviews - tripadvisor. [online] Retrieved from: http://www.tripadvisor.com.my/Restaurants [Accessed: 24 Jan 2014].
goPenang. (2013). Tan sam guan seafood - gopenang. [online] Retrieved from: http://www.gopenang.my/tan-sam-guan-seafood/ [Accessed: 11 Jan 2014].
[WEB BLOG]
Shah, S. ( 2013,11th April 2013). Best local restaurants in penang. BEST LOCAL RESTAURANTS IN PENANG, [web log] Retrieved from: http://www.mygola.com/best-local-restaurants-in-penang/q25083 [Accessed: 9 Jan 2014].
Sumptuos ( 2012,21st January 2012). Pantai seafood restaurant (水上人家) @ kg. sg. kayu ara, petaling jaya. Sumptuous®, [web log] Retrieved from:http://sumptuousblog.wordpress.com/2012/01/21/pantai-seafood-restaurant-水上人家-kg-sg-kayu-ara-petaling-jaya/ [Accessed: 11 Jan 2014].
Lam, C. ( 2010,23rd March 2010). Fresh & delicious seafood at ocean green seafood restaurant, penang. What2See : Best of Penang Food!, [web log] Retrieved from:http://www.what2seeonline.com/2010/03/fresh-delicious-seafood-at-ocean-green-seafood-restaurant-penang/ [Accessed: 11 Jan 2014].
Chin, W. Z. ( 2014,22nd February 2009). Pantai seafood restaurant @ kg sg kayu ara, petaling jaya. KAMPUNGBOYCITYGAL, [web log] Retrieved from:http://kampungboycitygal.com/2009/02/pantai-seafood-restaurant-kg-sg-kayu-ara-petaling-jaya/ [Accessed: 11 Jan 2014].
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Kim, S. ( 2013,14th January 2013). Restaurant fatty crab@ taman megah,pj. Yours Truly Saimnicy, [web log] Retrieved from: http://saimnicy.blogspot.com/2013/01/restaurant-fatty-crab-taman-megahpj.html [Accessed: 11 Jan 2014].
[e-BOOK]
Characteristics of Market Structure. (2013). [e-book] California: California Council On Economic Education. p. 1. Available through: econworks.org http://econworks.org/wp-content/uploads/2013/01/Characteristics-of-Market-Structure.pdf[Accessed: 11 Jan 2014].
[BROCHURE]
In Penang Free Map [Brochure]. (2013). Georgetown, Penang: Tourism Malaysia
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