Eleonora Escalante, MBA - MEng · • Salads • Sandwiches and Omelettes ... • All menu items are prepared daily at each restaurant, using high ... Saudi Arabia, Kuwait, Lebanon,

Eleonora Escalante, MBA - MEngStrategic Corporate Advisory Services

Creating Corporate Integral Value (CIV)

The Cheesecake Factory (I)

Introduction - Uniqueness Analysis using the Value Chain

4 March 2018

Eleonora Escalante MBA-MEng, Strategic Corporate Advisory Services

© 2017 Eleonora Escalante-all rights reserved

When in Auckland: Uniqueness Analysis using the Value Chain

14March2018

Let´s start with the example of the Competitive Differentiation Analysis (Uniqueness Analysis)

with an example: The Cheesecake Factory.

The Cheesecake Factory has a unique and

highly differentiation strategy:

1. Leader in menu innovation

2. Ambiance, Service and Hospitality

3. Best in Class operational Execution

4. Integrated Bakery

Why do you think the company say this?

We will find out…

https://support.office.com/es-ES/article/b89770f1-deb1-4a19-94ef-342aa15a4689




214-Feb-2018

A brief bee journey about The Cheesecake Factory:

Who?

Where?

When?How?

What?

For

Whom?

❶

❷

❸

❹

❺

❻





34March2018

Who is The Cheese Cake Factory?

Executive Officers:

• David Overton, 71. In 1972, He cofounded the company with

his parents Oscar and Evelyn Overton.

• David M. Gordon, 53. President of the Company.

• Matthew Clark, 48. EVP and CFO.

• Max Byfuglin, 72. President of The Cheesecake Factory

Bakery Incorporated. He has been in the bakery operations

for 35 years

• Debby Zurzolo, 61. EVP, Secretary and General Counsel.

Total Staff

Members 39,100

Restaurant

People38,000

Bakery

Operations 650

Corporate

Center and

Restaurant

Field

Supervision

450

David Overton, 71David Gordon, 53

Who?

❶

Source: Fidelity.com





44March2018

What is the Cheese Cake Factory?

The Cheesecake Factory Concept

The Cheesecake Factory restaurants chain

offers a distinctive, high quality dining

experience at moderate prices by offering an

extensive, innovative and evolving menu in an

upscale casual, high energy setting with

attentive, efficient and friendly service.

The Cheesecake Factory menu features

approximately 250 items segmented in

several groups:• Appetizers

• Pizza

• Seafood and Stakes

• Chicken

• Burgers

• Small Plates

• Pastas

• Salads

• Sandwiches and Omelettes

• Desserts

• Cheesecakes

• Beverages

As their name, the company offers

approximately 70 varieties of proprietary

cheesecake and other desserts.

The Cheesecake Factory brand identity

and reputation is based for offering

“High quality premium” food and

desserts. Only desserts represent a

significant 16% of sales last year.

Restaurants (lunch, dinner,

special occasion dining and

weekend brunch)

Take-Out (12% sales)

Delivery Service (third

parties)

On-line ordering for to go

salesThe Famous 250 items Menu

What?❷





54March2018

How does the Cheesecake Factory sell?How?

❸

• The CCF operates in the upscale casual dining segment.

• The average check for each customer, including beverages and

desserts was approximately $21.85 for fiscal 2018.

• The company has total control of the operations value activity.

• All menu items are prepared daily at each restaurant, using high

quality, fresh ingredients based on innovative and proprietary

recipes.

• Desserts are prepared and produced at CCF Bakery Facilities.

• CCF has targeted restaurant sites in high quality, high profile

locations and flexible site layouts.

• The CCF Restaurants have a Distinctive Design and Decor. The

company describes it as “a contemporary design and decor of

high energy, upscale ambiance in a casual setting”.

• The CCF has focused in commitment to excellent service and

hospitality through the selection, training and retention of high

quality staff members.

Value Proposition: Offering a

large variety of freshly

prepared menu items across a

broad array of price points and

generous food portions at

“MODERATE” PRICES.

CCF Bakery in

Calabasas,

California

CCF Bakery in Battleboro, NC





64March2018

How is the Cheesecake Factory measured?How?❸

Main

Financials:

Main Indicators 2017

Total Revenues (as of 31-dic-2017 $2.26 B

Net Income $157.392 M

Total Assets $1.33 B

Long Term Debt $113.53 M

Stockholders´ Equity $613.53 M

Market Capitalization $2.21 Billion

Earnings per Share (TTM) $3.27

Gross Margin (TTM) 18.17%

EBITD Margin (TTM) 10.86%

Pretax Margin (TTM) 6.48%

Return on Sales (TTM) 6.96%

Return on Equity (TTM) 25.54%

Return on Investments (TTM) 20.48%

The Cheesecake Factory Incorporated Stock Chart

$48.07

Source: NASDAQ

Source: SEC Filings 10K 28Feb2018 and Fidelity.com





74march2018

Where is the Cheesecake Factory?

In the USA and Canada:

The company operates 214 Company-

owned upscale casual dining restaurants

in the US and Canada, with the following

formats:

• The Cheesecake Factory Format: 199

• Grand Lux Café: 13

• RockSugar Southeast Asian Kitchen: 2

The company leases the properties

where the restaurants are located.

Internationally: The company has

licensing agreements with three

restaurant operators to develop and

operate in selected international markets.

There are 20 intl. restaurants located in

Bahrain, Saudi Arabia, Kuwait, Lebanon,

Qatar, UAE, Mexico and Hong Kong.

Where?

❹





84March2018

Evolution of the Cheesecake Factory?When?

❺

2001

The Cheesecake

Factory Oscar

and Evelyn

Overton

Charitable

Foundation

starts

1940s

Origin: Detroit, Michigan

Evelyn Overton found a

recipe in the local

newspaper that would

inspire her “Original”

Cheesecake.

1992.

CCF went public

1972

The Overton

moved from

Michigan to LA

2018

More than 214

restaurants

And growth

continues…

It was 1978 and he

opened the first The

Cheesecake Factory

restaurant in Beverly

Hills, CA.





94March2018

Who are the clients of The Cheesecake Factory?For

Whom?

❻

Millennials

married with kids

Single

Millennials

Baby Boomers

CCF

Generation X

Single, Married or

divorced with kids

Baby

Boomers Millennials

married with

kids

• CCF designs the restaurant offer

thinking in the “common” buyer who

wishes any of the 250 dishes at the

menu.

• From what I have observed, CCF is now

targeting the new generation Z by little

by little adapting it to the needs and

wants of them.

Families Gen X

“Most of Generation Z have used the Internet since a

young age, and they are generally comfortable

with tech and with interacting on social media”. Why

do they like Red Lobster more than The Cheesecake

Factory?

Generation

Z

Survey: Millennials love Red Lobster, older crowd loves

Cheesecake Factory, Consumer Picks 2016.





104March2018

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.

• After reading the main highlights about The

Cheesecake Factory.

• In our next post we will do the total Competitive

Differentiation Analysis for The Cheesecake Factory.

• We will use certain assumptions to illustrate the

calculations of several steps, since I don´t have all

the real information (this data is confidential, well

kept by the company and I don´t have the real

numbers).

• See you then!.

Step 1

Step 3

Step 4

Step 5

Step 6

Step 7

Step 8

Step 2


Documents

Eleonora Escalante, MBA - MEng · • Salads • Sandwiches and Omelettes ... • All menu items are prepared daily at each restaurant, using high ... Saudi Arabia, Kuwait, Lebanon,