-50%
Solution
3.1 Brief Market Analysis
In Grand View Research (2024) report, the global in-flight and rail sector catering services market size value is approximately $16.01 billion as at 2022. There are expectations of increased growth with a compound annual growth rate (CAGR) of 5.9% in 2023- 2030. In Qatar as identified earlier, the Catering Services Market has a value of $1109.32 Million as at 2023 with an anticipation of robust growth and development with CAGR of 8.82% to 2029. With the rail transport increasing in its demand in Qatar, the need for catering services has similarly increased with more than 50%. For instance, at 2023, QNA (2023) report evidence that Doha Metro had attracted 100 million in ridership from the launching of the service in 2019. This is with 333,000 passengers in a single day involved in the transportation process. Hence, as part of their operations, sourcing for catering services is important but achieving cost savings is equally instrumental.
3.1.1 SWOT Analysis
As part of market analysis and identifying areas of achieving value for money outcomes, strengths, weaknesses, opportunities and threats need to be put into account (CIPS, 2024a). A summary of SWOT analysis is illustrated in the following;
Source: (CIPS, 2024a)
In summary, from the findings of SWOT analysis, it is evident the factors are to the favour of QRC in sourcing of the catering services. Also, the weaknesses identify areas which would need to be capitalised on to minimise the different threats which have been identified. With the catering services being sensitive for sustainability of QRC, there is a need to engage suppliers for a well-structured terms and conditions to eliminate ay misunderstanding. With shift from over-reliance to oil and gas, this can also service as an opportunity for QRC to diversify to tourism sector and engage catering services which are multi-cultural. The reviewing of the budget is essential and has been identified earlier in this report.
3.1.2 STEEPLED Analysis
This is a strategy used to plan in order to discover, evaluate, organise and track different external risks (CIPS, 2024b). The tool is hence used in understanding the impact of external environment factors on achieving value for money outcomes.
Table 5:Summary of STEEPLED analysis for QRC organisation
Source: Summarised from (CIPS, 2024b)
| STEEPLED Factors Analysis | Analysis |
| Social | · Increased in population growth in Qatar offer opportunities for QRC to expand their operations hence more demand for catering services |
| Technology | · QRC can leverage on technology development in their supply chain operations |
| Economy | · Qatar economy is going under continuous growth hence attracting best suppliers with qualifications
· QRC can diversify their operations in tourism industry in Qatar |
| Environment | · Catering services must be sustainable based and adhere to best environment conservation |
| Political | · MENA region politics impacting railway network spread
· Relative stability in Qatar political environment attract highly qualified suppliers |
| Legislation | · Priority in selection of suppliers is provided to Qatar citizens as opposed to the foreigners |
| Ethics | · Catering services must adhere to highest ethical values as it deals directly with people |
| Demographics | · Millennials and Generation Z embracing rail transport hence need to accommodate their catering demands |
To conclude, in line with STEEPLED analysis findings, it is evident that QRC is in a favourable position in engaging different supplier of catering services. There is nevertheless a necessity for improving their leverage on environment, economic and social factors to improve their operations. This is with appropriate approaches put in place for embracing appropriate ethics and alignment with KSA laws.
3.1.3 Position and Market Placement Summary
In table 2 summary of QRC catering services, different sub-areas have been identified (Preparing meals for workers, Accommodation dining, Travellers meals and Preparation and consolidation of all menus of different travellers categories). In the catering services categories, a summary of preferred suppliers by QRC is illustrated in the following;
Figure 6:Summary of Catering Services Preferred Suppliers by QRC
Source: QRC internal documents
Therefore, catering services market in Qatar is not monopolistic market, multiple suppliers are in place implying existence of substitutes or alternative suppliers. In sourcing for Catering Services, QRC does not struggle to engage the best suppliers. For identifying competition in industry, Porter’s 5 Forces is applicable (Goyal, 2020).
Figure 7:Porter’s 5 Forces Analysis
Source: Summarised from QRC Internal documents
In sourcing for catering services by QRC, competitive rivalry is significantly high as Qatar is a hub of transport and link both locally and internationally. This is with a projection of the Qatar growing in their Public Transportation market in 2024 (Statista, 2024). This is with expected growth of annual rate of 2.61% in years 2024 to 2029 leading to projected market volume of US$0.58bn by year 2029. Similarly, having threats of substitutes and buyers high, sourcing catering services giving QRC a higher advantage in negotiating for costs effectively. Therefore, costs and quality of products and services is core for QRC competitiveness in Qatar railway sector. For effective practice, they would consolidate their sub-categories of their sourcing to reduce overall costs.
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