Ppcl Thailand Case Study

962 words 4 pages
Problem Identification
As negotiations proceed with Tricon, PPCL must determine whether or not to renew its contract and keep the Pizza Hut Brand Name. If PPCL signs the agreement, they will have no choice but to sign a non-compete clause which could be potentially damaging to its success moving forward.
Pizza Hut currently occupies the majority of the pizza market in Thailand. Whether or not the deal goes through with Tricon, PPCL must also determine how to expand the pizza category. The question they face is whether they can survive not only without the Pizza Hut brand name, but also whether they can achieve growth by expanding the pizza category in Thailand. Should PPCL cut ties with Tricon and build a new brand?
PPCL must also address
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PPCL is vertically integrated into cheese and ice cream manufacturing. Thus, Pizza Hut will not have any power over PPCL’s supplier relationships if PPCL doesn’t sign the agreement. They will however have to take charge of their own marketing. This could turn out to be beneficial because currently Tricon is only executing mass marketing campaigns and PPCL could potentially employ other marketing channels that catered better to the market in Thailand.
PPCL also has all of the skills, personnel and infrastructure needed to run its operation. If the agreement does not go through, the real loss would really be limited to the Pizza Hut brand name. PPCL can compensate for the loss of brand equity by reviving the menu and catering to customers’ tastes.
Continuing the Pizza Hut legacy
While PPCL could effectively create its own menu, if it breaks the franchise agreement with Pizza Hut, it will lose the intellectual property needed to replicate the Pizza Hut experience. If customers are really going to Pizza Hut for the specific taste of the food then the loss of this IP could be harmful. The data also suggests that Thai customers go to Pizza Hut for the brand experience as opposed to for the food. This is evidenced by the fact that they put ketchup on everything and when compared to Narai pizza, it only beat them on total satisfaction but lost out on 6 other attributes such as taste, value for money, staff friendliness and total