Storm’s competitive priority would be cost on purchasing and selling of its liquor and quality on its services offered. Cost: Purchase, material and subcontractor cost are the biggest cost for any nightclub. On average these costs are 40.9% of the total revenue (Industry Canada, 2013). According to Jon Taffer that beverage cost goes should remain below 21 % of beverage sales and food costs should be 29% to 32% of food sales (Taffer, 2009). Storm will strictly control its all cost at all time and will focus on following goals: Keep its total beverage cost below 21% of beverage revenue. Keep its food cost below 32% of food revenue. Purchasing: In purchasing, vendor’s prices will be regularly examined. Storm will compare the price and quality of food and beverage of different vendors before choosing the supplier (Taffer, 2009). This will help Storm to get the best rate for purchasing inventory. Another way to cut purchasing price is to pay early. According to the Small Business and Management, most vendors offer an average discount of 2% if invoice is paid within 10 days (A/N Group Inc., 2011). Strom will …show more content…
Storm will pay great concern toward reducing its waste cost to achieve the competitive advantage. Strom will implement a tight inventory management control in place to handle these costs. Apart from this, Storm will use specific recipe for drinks and foods so that each recipe has an identified cost. Employees will be properly taught and trained on handling product, obeying recipes and gaining efficiencies (Taffer, 2009). Bartenders will be trained to pour drink precisely. In the kitchen, cook will be taught on adhering recipes specifications, handling, and preparing food in a proper quantity. The manager will observe employees closely at all times to ensure if production accuracy is followed properly (Taffer,