Macroeconomic Factors Affecting My Other Kitchen

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INTRODUCTION
My Other Kitchen, a commercial kitchen space hiring and kitchen incubator, directed and owned by Jane Del Rosso, is looking to expand the business. The commercial kitchen hiring business is growing satisfactorily. However, greater growth is desired for the consultancy side of the business as stated by the client.
The aim of this report is to identify and analyse factors that will affect My Other Kitchen. The report first looks at macro-environmental factors to this business with a focus on demographics, economics, politics and culture. Then an analysis will be made of the competition to the client’s business which may affect the success and profitability of the business. Porter’s 5 Forces’ analysis is used with the focus on threat of new entry, intensity of rivalry and threat of substitutes. At the end of the report, competitors’ analysis is drawn to show what the client can do to be more competitive.
MACRO-ENVIRONMENTAL TRENDS
Looking at the macroeconomic environment there are three key factors that highly influence the success of expanding My Other Kitchen. They are the demographic and economic environment of selected areas, and the political structures which limit the ability for My Other Kitchen to trade.
Demographic and Economic Environment
As My Other Kitchen is looking to expand from the Kingston area to Glen Eira, it is essential to compare costs and benefits of surrounding areas to ensure which area will allow for the most success. Dandenong is in the same corridor as both corresponding areas and comparatively has lower costs of renting a warehouse space sized 350-400m², as shown in Table 1.1. The difference in expanding to Dandenong as opposed to Glen Eira is a saving of approximately $40,000-$130,000 per ...

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...l requirements as well as the food culture that is now much more prevalent affects the client’s business: My Other Kitchen.
In addition, it has shown how although there may not be immediate competitors in the business for food business incubators, the threat of new entry to this uncharted territory is ever increasing. Furthermore, substitutions for the type of business the client is offering are plenty. Substitutes such as getting accountancy services, advice from legal aid, attending courses on setting up business are just a few.
Therefore, in order to be competitive in this new and lucrative market of food incubator business that My Other Kitchen is aiming for, branding and marketing is vital. In conclusion, being aware of all types of competition and identifying the risks other factors that may influence of the success of the business is of great importance.

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