IT Strategic Plan

Swig
November 21, 2016

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 Table of Contents

Introduction 3
Swig SWOT Analysis 4
Porters Five Forces 7
Short-term solution 9
Long-Term Recommendation 11

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 Introduction

We have spent this past semester observing, recording, analyzing and

searching for solutions for Swigs famously long lines. Swig is a popular business
with locations all over Utah and because of their popularity, their lines tend to
get a little long. After listening to Talon and Mitzi from Swig Corporate, we took
note that it wasnt Swig that was struggling with filling orders but more it was the
customer. Customers approach the window and are either unsure of what they
want to order or do not know how much the price would be of the total order.
These events tend to slow down the process of ordering and receiving orders.
This is the cause of the long lines. So, we focused our efforts on the customer.
What could we do to help the customer decide faster or have their payment
ready to go so that they are in and out as quick as possible? We will answer this
question with our recommendation below.

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 Swig SWOT Analysis

SWOT analysis is a process that identifies the strengths, weaknesses,

opportunities and threats of an organization. Specifically, SWOT is a basic,
analytical framework that assesses what an organization can and cannot do, as
well as its potential opportunities and threats. (Investopedia)

Strengths Swig is one of the fastest- Weaknesses - Their services can

growing soda shops here in Utah
and is the market leader. They have
great brand loyalty with a well-
established firm and well-defined
market shares
have long wait times, which can be
partially attributed to their confusing
menu, which is in direct conflict as
the target market for Swig want to
have their drinks fast

Opportunities Drinks shops are Threats - There has been an

becoming very popular here in Utah increase in soda shops here in Utah
especially with the large LDS especially in Northern Utah and will
community who do not drink coffee trickle down to Southern Utah
and so they turn to soda

Strengths
Swig is growing at a rapid rate compared to other soda shops in Utah.
They act as a market leader for soda drink shops in Utah and are highly
regarded.
They have great brand loyalty. Swig is a very well-known brand here in St
George as well as increasingly throughout Utah. They have a well-established
firm with a well-defined market share which keeps customers coming back.
Their main products are soda drinks and assorted treats which are
relatively cheap to produce and have a high-profit margin. Their locations are
generally small drive thru shacks which require lower upkeep and overhead
costs.
Swig product is convenient for their main target market, traditionally
college students and middle-aged parents.

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Weaknesses
Service can be slow, and typical wait times can be minutes. A large part
of this is due to the long and confusing menu. The target market for Swig wants
to have their drinks fast, and returning customers know what they want, however
new customers can slow down the queue by having to sort through the
complex menu, decreasing the overall throughput time.
Swig has a limited product offering. There are not a lot of options for
health-conscious customers, which are becoming more common in their target
market. As more of the target market turn to healthier alternatives and more
specialized diets such as vegan, gluten-free, or low sugar they could see
decreases in overall customer base.
By suing their competitors for a trademark violation, they are causing bad
publicity and incurring large legal expenses.

Opportunities
Soda shacks are becoming increasingly popular across both Northern and
Southern Utah. Utah is well known for having a large population of LDS church
members who do not drink coffee, making soda a big seller.
The soda business is growing rapidly, and has appeal in stand-alone
stores, but have the potential to expand the franchise and industry into theme
parks, stadiums, and other large venues.
There are new technologies currently in development that can allow Swig
to expand. Drive-thru apps are creating an increase in brand recognition, and
improving the efficiency of the drive-thru system. Interfacing app development
and social media can allow Swig to reach out to the community and grow their
brand and exposure.

Threats
Swigs competitors are starting to occur more frequently, starting in
Northern Utah and soon expanding into Southern Utah. One huge threat in this
market is the product itself is easy to replicate, and as such there can be new
entrants into the market that could match or undercut swig.
Swig may have a problem with expanding, as their current locations are
typically busy, and the convenience for the customer decreases as the wait
time increases. Some of the Swig locations only have limited space for the drive-

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thru, causing frustrations when long lines can interfere with neighboring
businesses. Because their product is not necessarily unique, as there becomes
increased competition, price and efficiency are going to become the
determining factor for which brand customers choose.
Swig will always have the threat of other competitors as their business is
easy to replicate. This can lead to future legal battles and lawsuits between Swig
and their competitors. Swig also runs the risk of customers blocking traffic flow,
parking in areas not designated for parking, or getting in accidents with other
vehicles in surrounding areas.

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 Porters Five Forces

Porter's Five Forces is an analysis process that analyzes the competition in

businesses. This is very helpful in creating a business plan that is competitive.

Porters Five Forces consist of Threat of New Entry, Competitive Rivalry, Supplier
Power, Threat of Substitution, and Buyer Power. Swig must deal with each one of
these within their own business.
Swig always must deal with the Threat of New Entry. Compared to the startup
costs of other companies in other industries, startup cost and time in this industry
seems cheaper and a lot less time to do so. There isnt a whole lot of specialist
knowledge that is needed in being able to start up your own beverage
store/stand. There are very few barriers to entry.
For Competitive Rivalry, right now there isnt a whole lot of competition. But this
can and probably will change here very soon. It is very difficult to differentiate
their product from the product of the competition. Swig and its competitors
should be able to get the same supplies at the same costs. This creates relatively
small quality differences between companies.
When it comes to Supplier Power, there are several suppliers in Utah that would
be able to supply every business in this market. These suppliers seem to be big
and can meet the demands of Swigs and potentially other businesses. There are
many substitutes available in the market of drink flavoring as well as straws and
Styrofoam cups. Because of this, Swigs must deal with the Threat of Substitution.
This means that there are many products that are like each other, but may be
available at different pricing. This could cause some of the Swigs competitors to
be able to offer the customers a better deal on drinks. The cost of change for
the substitutes could help to save both the customer and business money.
The last of Porters Five Forces is Buyer Power, which is huge for Swig. They have
a dedicated fan base from the casual consumer to the drink fanatics. The drink
orders can greatly vary depending on the size of the party that will be
consuming the product. There can be slight differences between Swigs and their
competitors. These changes can be in options for drinks or else even go into the
sweets portion of the business (cookies, shakes, snow cones, etc.). Most
customers are sensitive to pricing on drinks. They know that if Swig or another
company have high prices, they can go somewhere else to get their fix.

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Strategy
After considering the SWOT analysis and Porters Five Forces, the strategy for
Swig is to focus on increasing their brand recognition and embracing their
current strategies. They were the first company in this area to focus on mixed
soda drinks, and they have greatly increased the industry throughout Utah. Swig
needs to embrace their fan base, and continually push that they are the original
soda shop in the area, and they care about the customers. They need to
continue to rejuvenate their business strategy to incorporate new drinks and
products, while staying true to their original business plan as being the first dirty
soda shack in Utah.

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 Short-term solution

We have some possible solutions that are both short-term and long-term. For our
short-term solution, we thought of something that could be a quick fix, quick to
implement and would be low cost until we could establish a more long-term
solution. Our solution is to print out swigs menus and laminate them. The goal
would be to have about 50 per store. While employees are taking orders
outside, we would suggest that the employees take these menus and hand
them out to customers that are waiting in line. As mentioned earlier, we believe
that the cause of long lines is the customers trying to figure out what they want
to order and how much it cost. By the time the customers can see the menu in
front of the store, they need to order. Right now, customers sit at the window
and try to figure out what they want and this is lost time. The time in line could
be more efficient if it was spent deciding on what to order than sitting in line and
doing nothing. By handing them a menu, they will be able to look it over and
have their mind made on what they want to order and a close projection of
how much their order will cost before the approach the window. Then, when
the customer reaches the window, they simply hand the menu back to swig and
they rotate them out.
We also thought about creating a new menu. We believe that customers like to
order by their favorite soda. If we could create a menu that is categorized by a
specific soda (Diet coke, Dr. Pepper, Mt. Dew, etc.) and show a list of what
specialty drinks are available for that specific soda. This will help customers find
the drink they want by easily locating the drink they want by being able to find
their favorite soda and then find variations of that soda. Also, a list of customer
favorites could help the new customer decide what to order.

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Sample New Menu

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 Long-Term Recommendation

For our long-term solutions, we decided that it would be best for Swig if they
were to develop an App. In this App, customers would pre-order their drinks and
sweets through the App. Once their order is complete, they hit a button that
generates a barcode as well as tells them the amount owed along with the
options of pay now or pay later. If they choose to pay now, the customer will
have the option to save their credit card information to the App. Once the
customer has a barcode, they drive to Swig and have their barcode scanned.
Swig will not complete the order until the barcode is scanned at the store. This
will help cut out orders being placed and made, but not picked up. Once
scanned, the workers will have the correct order. Now, the customer will pay if
they chose the pay later option. If they chose the pay now option, their card
would be run now as well. The customer will then wait until they receive their
order. We believe this will help cut down on waiting time in line for the
customers.
It would be best to do a survey of customers on if they would use such an app
and if they did how often they feel it would be used what features they would
like on the app. We would suggest having an incentive to do the survey by
offering 10% off the next drink at Swig if they fill out this quick survey. A pool of
about 100 people would be a great way even to know if the customers would
be interested in this app before investing into it.
To help Swig with an app idea, we reached out to Cody Mace. He is a Software
Engineer at RocketMade. They are a local app developing company. We asked
Cody how feasible would it be to make an app like this. He stated Something
simple would probably take a couple months for the front-end app and then
something on the backend and then a component used in the kitchen to
manage online orders. He never mentioned to us a cost on that though
because it would depend on many different variables. He also said, Im sure
theres existing products out there they could leverage. He then went on to
give us an example. He said, Heres an example of a company that does this
for restaurants: Olo.com. He went on further to explain about the company.
So, a restaurant signs up with them and get their own custom app built.
We also reached out to a developer here in the St. George area, James
Brinkerhoff, about an app for Swig. He said it would take about four to five
months to make it depending on the features we want. He suggested having
an admin part of the app where customers can log in as a user and have a
history of their favorite drinks. The customers information is already saved so all

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they would have to do is chose the drink they want. This would be an excellent
way to help bring in business too because if you have an app on your phone
and people are just staring at their phones they would see a Swig app pop up
and help them to realize they could use a drink right now. This would reach their
target market.
James Brinkerhoff also suggested to use local developers in the area such as
generationlabs, rocketmade, and velocitywebworks would be great
contenders to develop the custom app and they're all located here in the St.
George area. We did talk to Rocket made about the app and they would be a
great contender.
Olo.com Is a great solution for a template and they specialize in restaurant
ordering They have something called the digital ordering and it's a software-as-
a-service digital ordering engineering. It's designed for multiple locations to have
group ordering capability. It is also designed to work with popular POS systems
payment providers and loyalty programs. It works with gift card providers.
This would be a great alternative than having to make a fully customized app
and it will take less time. Swig would still have to make the body of the app but
the technology and logic behind it are already there with Olo.com.
This is something Swig should take a good look at in future as the company
grows. The cost of this app varies with different features and is determined after
a consultation with this company. We recommend that for now a simpler app
will work until you find out if the market would support a more complex app like
Olo.com.

Sample Olo.com app

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 Another Sample Olo.com app

We made a mock-up of the app as an example of what it would look like when
they develop it. This all depends on what features if you want to add to it and
how you envision it with a barcode scanner. You purchase an item and then
you scan the barcode when you arrive at the Swig.
Figure 1 is an example of what it would look like if you decide to include this in
your business. This would be the home page and it would have the Swig logo
and a nice color scheme. It would have the menu on the front and the ability to
search for favorites on the menu.

Figure 1

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The second page will be available after your login. It will show your history and
your past drinks will show so you can just click a button and easily order your
favorite drink. The menu also shows up on this page which is nice if you want to
try something new. There is a map you can add to show you where the closest
Swig is.

Another thing that you can add to this app is a social media link. You can link to
your Twitter, Instagram, and Facebook pages. This makes it easy for customers
to leave comments about Swig.

Figure 2

To sign up you would put in your information. That includes your first name, last
name, a password, date of birth, credit card information. You can always
change this. Figure 3 is an example of what login would look like.

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 Figure 3

This is the barcode page and would require a bar code scanner like those used
at most retail stores. These scanners cost anywhere from $20.00 to $100.00
depending on the system you have in place now. After you order and you pay
for your drink there would be a bar code created that would be scanned when
you get to the window. The drinks would then be created and this would help
prevent drinks from going flat. This process would speed up the line
considerably.

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 Figure 4

As you can see, we believe the best route for Swig to take would be
essentially a two-step process. It would be best for them to implement a good
short-term fix/ option until their long-term option (App) were completed. There
would be an easy smooth transition between the two options. By implementing
these, it would help Swig be more effective and efficient in their goal of
shortening the wait for a drink and treat. It would also give the customers more
tools in their hands so that they can know much quicker what they want to
order.

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 Cited Works

Brinkerhoff, James. Personal interview. 17 Nov. 2016.

Investopedia.com. http://www.investopedia.com/terms/s/swot.asp.

Mace, Cody. "Swig N Sweets App." Telephone interview. 27 Oct. 2016.

"Online Ordering for Restaurants." Olo.com. N.p., n.d. Web. 27 Oct. 2016.

Stringham, Talon, and Mitzi Sampson. "Swig N Sweets." Swig Owner Presentation. UT, Saint

George. Sept. 2016. Speech.

Swig N Sweets SWOT Analysis. Oct. 2016. SWOT Analysis.

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