Marketing environment means the internal and external environment which affects a business operation. The internal problems which may arise in the catering operation may be in the Food and Beverage departments, employees and control of cash and pricing. External environment can be, Political, Economic, Demographic/ Social and Technical factors.
a. Food and Beverage Department
In the food and beverage department perishability of food can be an important factor which can influence the final product. T he perishability of food has to be checked while food purchasing, storing and while issuing. Wastage of foods may lead to poor portioning control and poor production planning. Pilferage from kitchen, restaurants, bars and store can be directly influencing the f inal cost of the product.
Employee shortages often coincide with peaks of sale activity and surplus can coincide with troughs of sales activity. Absenteeism, illness and use of parttime/casual employees in food service operations can be possible causes for an internal problem. Poor supervisions can also lead to poor employee output.
a. Control of Cash and Pricing
Most transactions are conducted on a cash basis in food and beverage sales outlets and hence good control is needed. Correct pricing of menus and beverages lists are important when food prices fluctuate.Tighter financial and management controls are required in stores. If any problems arises outside the organization and that cannot be solved internally are known as external environment factors.
It is Government legislation and change in the location structure.
Rising costs such as food and beverages, labour, fuel, rates and insurance, sales instability, for E.g.: peaks and troughs of activity that occur on a daily, weekly and seasonal basis, changes in expenditure patterns and people’s disposable incomes, expansion and retraction of credit facilities and high interest rates on borrowed capital.
c. Demographic/social environment:
It can be changes in population distribution. For E.g.: population drifting away from certain areas, changes in the socioeconomic groupings of the area, growth in ethnic minorities leading to a demand for more variety of foods and changes in food fashion. For example, current popularity of take away foods, healthy eating and diets.
d. Technical environment:
It can influence a product can be mechanization, for E.g.: in food production and food service where labour saving devices or custom made equipments can change the cost of a product. Product development and food processes, for eg: vacuum packaging for products. Digital economy, increasing advertisement cost due to advances in media for eg: satellite, TV and high percentage of TV and video ownership. Marketing is an essential element in food service institutions and many food service operations have a marketing manager who looks after the sales promotion, marketing techniques and customer satisfaction. Hence it is important that to sell a product marketing and entrepreneurial skills are important.