Topic > Strategic Analysis of Sonic Corp - 1980

Executive SummarySonic is the largest drive-in chain in the United States. With the slogan "America's Drive-In," a Sonic offers quick service from roller skating garages and unique menu items that can't be found at McDonald's, Burger King or Wendy's. Sonic restaurants operate in 27 states, so they're smaller than major fast food chains, but they're still a significant competitor. Founded by Troy Smith and Charlie Pappe in 1953, Sonic has grown from a single root beer stand to a popular franchise. In 1973, Sonic restructured itself as a franchise company and later became Sonic Corporation. The company suffered financial decline due to a lack of consistency on the part of its franchisees, so they were taken over by Sonic Corporation and restructured. In 1995, Sonic introduced "Sonic 2000", an aggressive multi-layered strategy to further unify the company in terms of consistent menu, brand identity, products, packaging and service. The campaign was successful and Sonic's brand recognition increased. Strengths include a strong competitive nature, flexible strategies and employee/franchisor relationships. Weaknesses include lack of communication and internal expansion. Threats in the external environment include company size, employee turnover, weak economy, rivals in similar industries, overseas expansion, and slow-growing markets. Sonic can overcome these threats with opportunities such as global expansion, increasing the number of quick-service consumers, and attractive investment opportunities. Alternative strategies and recommendations suggest that Sonic should focus on a low-cost strategy and focus on niches such as the natural foods market. Sonic Corporation History and Strategy Sonic Corp. franchises and operates unit...... middle of paper ... ...target market Sonic could devote its energies to the "health fanatic" niche . There are those who pursue healthy lifestyles but have difficulty finding fast food when in a hurry. Since Sonic has a reputation for serving unique items, it would be easier to sell healthier food products. McDonald's and Burger King have had difficulty focusing on their niche as they have had a history of "greasy burgers and fries". This could give Sonic a competitive advantage to take on industry giants. Sonic is a significant competitor in its core markets and beats national chains in terms of services such as customer satisfaction and loyalty. With these strategic implementations, Sonic has the potential to defeat competitors like McDonald's because the market is constantly evolving and one company cannot remain number one forever.