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Sbarro's Blue Ocean

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Blue Ocea an cre eating g value e in Sbarro o

Introduction

In 1956, t the Sbarro family opened their first Salumeria (Ital o r lian grocer store) in ry n Brooklyn, which wa soon a neighborh , as n hood favorit for its ex te xceptional fresh food and lly authentic Italian far includin homem c re, ng made mozza arella, imp ported chee ese, and de elicious sausage a and salami Only elev years l i. ven later, in 19 967, Sbarr opened i first ma ro its all-based restauran in Brook nt klyn's King Plaza Sh gs hopping Ce enter, mark king the bi irth of the modern Sbarro co oncept: delicious, fres and aut sh thentic Ita alian food in an open kitchen th n hat allowed fo fast selfor -service. As we can see, the s n success of Sbarro wa born by the innov as y vative syste of supp em plier which Gen nnaro and Carmela Sbarro cou invent. They, unconsciousl in 1967 were d uld . ly, 7 applying t the modern concept of blue oce n ean strategy, which was ration nalized by W. Chan Kim and R Renée Ma auborgne in 2005. n Working i a blue o in ocean is mo simple than work ore e king in a red ocean, where the competitio focuses itself. In according to the theo of Port on s a ory ter, in fact, not only industry , i competito are dan ors ngerous, bu also oth four ca ut her ategories of competito must be f ors b necessary considere in the play of com y ed p mpetition.

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orces m model (P Porter) ) Five fo

The Five F Forces mod of Porter is an Ou del utside-in business unit strateg tool tha is used b u gy at to make a analysis of the att an s tractivenes (value) of an indus ss o stry struct ture. The Competiti Forces analysis is made by the identi ive s ification of 5 fundam f mental com mpetitive forces: y petitors. How easy o r difficult is it for new entrants to start H i s 1. Entry of comp competing which barriers do exist. g, 2. Threat of subs stitutes. How easy c an a produ or serv H uct vice be sub bstituted, especially e eaper. made che 3. Barga aining pow of buy wer yers. How strong is the positio of buyer Can the work t on rs. ey together in ordering large volu g umes. aining pow of sup wer ppliers. Ho strong is the posi ow ition of sel llers. Do many m 4. Barga potential suppliers e exist or on few pote nly nopoly? ential suppliers, mon y the existin players Does a strong com ng s. s mpetition be etween the existing e 5. Rivalry among t players ex xist? Is one player ve domina or are all equal in strength and size. e ery ant a n h

The blue oce ean stra ategy

Rather th han compet ting within the confin of the existing in n nes ndustry or trying to steal s customers from riva (Bloody or Red Oc s als y cean Strat tegy) W. Ch han Kim an Renée nd 2

Mauborgn are sugg ne gesting Blu Ocean S ue Strategy: developing uncontest d ted market space that make the com es mpetition ir rrelevant. The real o opportunity is: to cre y eate blue o oceans of uncontested market s u space. Of course competition is impo e ortant. But by focusi t ing on com mpetition an compet titive nd advantage accordin to Kim and Maubo e, ng a orgne, sch holars, com mpanies, an consult nd tants have ignored tw very im wo mportant - and far mo lucrativ - aspect of strate a ore ve ts egy:    To find and d develop blu oceans, and ue To exploit an protect blue ocean These challenges are very d o nd ns. s different fr rom those to w which stra ategists ha devoted most of their attent ave d tion. In blue ocean demand is created rather th ns d d, han fought over. The is ample ere portunity f growth that is bo th profitab and rap for ble pid. opp

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