BUSINESS STRATEGY FORMULATION FOR STREET FOOD VENDORS IN FACING COMPETITIVE BUSINESS ENVIRONMENT

• Main Author: Erlangga, Galang
• Format: Theses
• Language: Indonesia
• Subjects: Manajemen umum
• Online Access: https://digilib.itb.ac.id/gdl/view/46464
• Institution: Institut Teknologi Bandung

The presence of street food vendors is very familiar in many cities in Indonesia. Many of them can be found vending in public places and utilize mobile carts or semi-permanent stalls to sell food and dishes at affordable and low prices. Although their vending activities are often considered as a city problem, street food vending is regarded as the best option to earn a living, especially for low-income households. Street food vendors are mostly micro entrepreneurs who are involved in the urban informal sector. Their characteristics are generally small scale of operations, family ownership, and possess low skills and capabilities. With emphasis to the latter, the limitation puts street food vendors at a disadvantage situation when facing a competitive business environment. Nowadays, street food vendors compete with not only from fellow street food vendors, but also from restaurants and the emerging food delivery services. This competition reduces market share for street food vendors. Therefore, an appropriate business strategy is needed in facing such competition. In formulating the appropriate business strategy, this study adopted AFI (Analysis, Formulation, and Implementation) strategy framework and relied on qualitative approach such as interviews, focus group discussion, and observations to obtain the data required. Started from the analysis of external environment of street food vendors using PESTEL framework and Porter’s Five Forces, then proceed with the analysis of internal conditions of street food vendors using resource-based view, VRIO framework, and value chain analysis. This study also carried out a qualitative market research with the aim to gain insight about customer preference towards street food vendors. Then this study employed generic business strategies and TOWS matrix to propose several strategic alternatives. Last, a strategy diamond model was utilized to provide a more detailed approach to what strategies should street food vendors and how to carry it out. After conducted a thorough analysis, this study suggests that street food vendors should pursue a differentiation strategy. The differentiator carried out should present valuable benefits to customers such as first, the food and dishes offered are tastier with bigger serving size while keeping the price still affordable. Second, the food and dishes are handled properly to ensure its cleanliness and suitability. Third, the vending location that is convenient, clean, and decent. And fourth, pleasant hospitality and great service when serving the customers. This study also emphasizes the need for assistance from the government, academics, practitioners, and NGOs to participate in improving street food industry as well as the lives of street food vendors