CHEESECAKE FACTORY SHORT REPORT
Cheesecake Factory Short Report
Bridgette Gardner
Cornerstone Consulting
Towson University
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CHEESECAKE FACTORY SHORT REPORT 2
Research shows that Cheesecake Factory is doing very well. They have incorporated a number of items into their business that are specifically designed and very original. Through their financials, menu analysis, marketing analysis, and competitiveness, I have concluded that
Cheesecake Factory will not need our consulting services.
Cheesecake Factory was founded in 1978 in Beverly Hills, California (The Cheesecake Factory,
2013). It is an upscale casual dining restaurant that now operates with several locations worldwide. Cheesecake is known for the vast menu as well as the main bakery items “the cheesecake”.
Size.
Cheesecake Factory builds their locations depending on a number of factors such as population density, demographics, retail, business, entertainment, and other traffic generators and geography.
Cheesecake searches for an area that is very reputable when searching for new locations. They look at demographics, residences, businesses, and other entertainment in the surrounding areas. Cheesecake designs the restaurants they build specifically to the location they choose. For example, one location in Texas could be a lot bigger than the Cheesecake Factory in a city area such as Chicago due to the varying demographics of those areas. (The Cheesecake
Factory, 2013) Cheesecake size is part of their brand that is why they are also expanding.
International expansion.
Cheesecake Factory is expanding. They have been steadily increasing to international markets every year. First, they started expanding to the Middle East, and now they are looking into expanding in Latin America in 2013. Cheesecake is looking to expand their business internationally and be very successful (The Cheesecake Factory, 2013). When
Cheesecake Factory expands internationally, they want to keep the quality of the company as well.
Quality.
Cheesecake begins with quality very early in their business process. The first step, which is choosing locations, involves quality and Cheesecake makes sure they choose a location with high quality. Cheesecake really makes itself adaptable so it can choose various locations and adapt to the surroundings. Cheesecake really appreciates the diversity of their customers and wants to consider them when selecting a location and running a Cheesecake Factory restaurant
(The Cheesecake Factory, 2013). Quality with Cheesecake is included in every aspect of their business starting with their menu.
Menu. Cheesecake gets ahead with their variety on the menu. According to the Cheesecake
Factory, (2013) “The Cheesecake Factory menu features over 200 items in addition to items presented on supplemental menus, such as our Skinnylicious menu, which offers over 50 innovative items at 590 calories or less. Menu offerings include appetizers, pizza, seafood, steaks, chicken, burgers, specialty items, pastas, salads, sandwiches, omelet’s and desserts, including approximately 50 varieties of cheesecake and other quality baked desserts” (pg 5). By having a large range of foods on the menu, they can accommodate to a diverse guest base.

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Cheesecake knows that their menu is what puts them ahead of their competition. By knowing this they make sure the menu is always improved. Cheesecake updates their ingredients for their menus and how they prepare their food through cooking frequently. They analyze and review their menu twice a year. This is so they can get ideas on what new menu items to offer, what menu items are successful, and how to create new appeal to customers (The Cheesecake Factory,
2013). They are putting their efforts into the menu because they know it is a huge part of who they are to their customers.
The bakery product that Cheesecake offers is one of their strengths. This sets them apart from every other casual dining restaurant. The bakery products, which includes a large variety of cheesecakes, really creates an extensive menu for them. This creates a large strength.
(Marketline, 2012).
People. Cheesecake puts a lot of effort into hiring the most qualified candidates. They have more than 32,000 managers and staff in their restaurants, bakery facilities, and corporate center.
Cheesecake dedicates a lot of effort into the development of their business and their training. The company has a variety of tools and computer systems that are involved in the training of employees. This allows the new hire to become very successful once he or she is done their training. Cheesecake also offers their employees full-time benefits to all staff that works more than 25 hours a week (The Cheesecake Factory, 2013).
Communities. Cheesecake spends a lot of time in the communities and provides as many services as they can. Cheesecake has established their own foundation to help the community. Their foundation is called The Cheesecake Factory Oscar & Evelyn Overton Charitable Foundation.
This shows that the Cheesecake Factory really cares. The Cheesecake also involves them in community service. Cheesecake Factory is a “Mission Partner” with Feeding America® (The
Cheesecake Factory, 2013). Customers really appreciate when companies are involved in such great community service programs. By Cheesecake being involved in the communities it shows they have greater goals then just running a successful restaurant, but also providing where they can.
Sustainability. Cheesecake prospers by relying on sustainability. Cheesecake knows that they need to apply their past actions to improve on their future actions. By doing this they are and will be very successful. Value is created for Cheesecake Factory through their sustainability.
Cheesecake takes opportunities to better their selves. They want to create structure that includes their culture as well as their values through the restaurant operations (The Cheesecake Factory,
2013). This shows that they know sustainability is important and have already been seeking help through another consulting firm.

CHEESECAKE FACTORY SHORT REPORT
Revenue is escalating showing expansion is helping
Cheesecake has increased their revenues every year from 2009-2012. In Figure 1, you can see that the revenue increase has been pretty substantial each year. This shows that Cheesecake is making improvements every year that are very successful. Cheesecake has been expanding in recent years as well, so from the increasing revenues, it is safe to say the expansions are creating success for Cheesecake Factory.
Financial Data
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Figure 1
Note: Cheesecake Factory. (2013).
FY 2012 Form 10-K. Retrieved from http://investors.thecheesecakefactory.com/phoenix.zhtml?c=109258&p=quarterlyearning s.
Sales shows increasing growth
Sales.
In Table 1 below, you can see that Cheesecake has a sales growth of 2.92%. This shows a significant growth in sales over a year. Also looking at table 1, it is shown that there is growth of employees. This is also another successful growth. With more employees there can be greater service provided.
Table 1
Note: Factivia Companies and Executives (2013). Cheesecake Factory, Inc.
Retrieved from
Factivia.

CHEESECAKE FACTORY SHORT REPORT
Net income is showing growth
Net income is increasing every year. The fact that Cheesecake can show an increase in net income between 2010-2012 when they expanded to the Middle East shows that they can handle their money pretty well. With expansion come a lot of extra costs; however, it seems to be providing extra income for Cheesecake in 2012. You can see this below in Figure 2. Net income went from 95,142 in 2011 to 98,423 in 2012 (The Cheesecake Factory, 2013).
Net Income Chart
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Figure 2
Note: Cheesecake Factory. (2013). FY 2012 Form 10-K. Retrieved from http://investors.thecheesecakefactory.com/phoenix.zhtml?c=109258&p=quarterlyearnings.
Cheesecake is successful in the United States
Although there is emphasis on expanding Cheesecake Factory, it also has prominent presence in the United States. Cheesecake owns and operates 156 locations currently. Cheesecake has a strong brand that is known throughout the United States, which gives them another strength.
(Marketline, 2012).
Global expansion to Latin America shows Cheesecake is taking risks
Cheesecake announced at the end of 2012 that they would be expanding their business to Latin
America. This shows that Cheesecake wants to have more international locations. By expanding their horizons, they have the potential for great success.
Cheesecake has an agreement with Latin America. This agreement included terms that allow
Cheesecake to build a minimum of 12 restaurants throughout Latin America. It has been discussed that the first Cheesecake Factory is anticipated to open in Mexico City by 2014 (The
Cheesecake Factory, 2013). This shows Cheesecake is looking at expansion on a high level.
There are several countries, not just one, they plan to expand to in Latin America.

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“Word of Mouth” advertising is effective but TV advertising could increase effectiveness
Cheesecake could expand their marketing; however, the current marketing is pretty successful.
Cheesecake uses the process of “word of mouth” advertising. They rely on this process to market them selves to gain new customers. They do not use the customary advertising like radio/TV commercials or print sources. They rely on “word of mouth,” some social media advertising through Facebook, Twitter, and emails, and offering discounts to bring in new customers (The
Cheesecake Factory, 2013). Yes, these are all items that could be relied on for marketing; however, I would suggest TV commercials as well.
The marketing through “word of mouth” and social networks is very effective. Many people today use social networks because it is fast and easily accessible. This is why Cheesecake is successful without TV commercials. I believe if Cheesecake added a TV commercial that aired every so often on a main channel such as ABC, then Cheesecake could become even more successful.
Cheesecake is keeping up within the restaurant industry
In 2012, there has been slower growth than normal in the restaurant industry. Restaurants have been struggling to maintain very good success. In order for the restaurants to be successful in the struggling economy, most restaurants are upgrading their brand images (
Standard & Poor’s Net
Advantage, 2013).
Cheesecake has been constantly performing this through upgrading their menu twice a year to meet the needs of their consumers, offering bakery products, and expanding their business internationally. This shows Cheesecake is altering their business to be successful in a stressed industry.
Cheesecake knows how to keep up with its competitors
Cheesecake is keeping up within the restaurant industry and competing well with its competitors.
In Table 2 it shows the comparison between the Cheesecake Factory, Applebee’s International,
Inc, OSI Restaurant Partners, LLC, and P.F. Chang’s China Bistro, Inc, and the Industry.
Referring to Table 2, you can see that CAKE’s income is 98.2M compared to 89.90M that OSI
Restaurant Partners, LLC has. It also has more income than P.F. Change’s China Bistro, Inc.
Overall, it can be shown that Cheesecake is in a good place and is a competitor in the restaurant industry.
One of Cheesecake’s competitive advantages is the size of its restaurants. The large sizes of the restaurants allows for a large amount of seating (Hoovers, 2013). Cheesecake Factory puts a lot of thought into where they choose their locations, which also makes them very successful, and have a strong competitive advantage in the restaurant industry.

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Table 2
Note: The Cheesecake Factory Incorporated (CAKE) Competitors. (2013, March 28).
Yahoo!Finance
. Retrieved from http://finance.yahoo.com/q/co?s=CAKE+Competitors
Overall- Successful.
Cheesecake is showing that they are trying to create and take opportunities through expansion, financial increases, and a defined and recognized brand. I do not believe that Cheesecake
Factory will need Cornerstone Consulting’s business. I believe they have areas of possible improvement, but overall they are competing well and running a successful casual dining business. I am available to discuss these results with you or answer any questions you may have regarding this report.

CHEESECAKE FACTORY SHORT REPORT
References
Cheesecake Factory. (2013). FY 2012 Form 10-K . Retrieved from http://investors.thecheesecakefactory.com/phoenix.zhtml?c=109258&p=quarterlyearnings.
Factivia Companies and Executives (2013). Cheesecake Factory, Inc.
Retrieved from Factivia.
Hoover’s (2013). Hoover’s Company Record-In-depth Records. The Cheesecake Factory
Incorporated. Retrieved from LexisNexis Academic.
MarketLine (2012). The Cheesecake Factory Incorporated: SWOT Analysis.
Retrieved from
Business Source Complete.
Standard & Poor’s Net Advantage (2013). Current Environments.
Retrieved from Standard &
Poor’s Net Advantage.
The Cheesecake Factory Incorporated (CAKE) Competitors. (2013, March 28). Yahoo!Finance
.
Retrieved from http://finance.yahoo.com/q/co?s=CAKE+Competitors
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