Business Strategy Prioritization for a Food Testing Laboratory: An Indonesian Case Study

Abstract

Background: Food testing laboratories operate at the intersection of regulatory compliance, food-safety assurance, and competitive service markets. In Indonesia, mandatory testing requirements for processed-food licensing and laboratory accreditation create stable demand, while increasing competition requires laboratories to strengthen their strategic positioning.
Purpose: This study identifies internal and external factors affecting the business performance of an Indonesian food testing laboratory, formulates alternative business development strategies, and determines priority strategies for implementation.
Design/methodology/approach: A case study approach was employed using expert judgment, interviews, observations, questionnaires, and company performance records. Internal resources and capabilities were assessed using the VRIO framework and evaluated through the Internal Factor Evaluation (IFE) Matrix. External conditions were examined using PESTEL and Porter’s Five Forces and evaluated through the External Factor Evaluation (EFE) Matrix. The laboratory’s strategic position was mapped using the Internal–External (IE) Matrix, alternative strategies were generated using SWOT analysis, and strategic priorities were assessed using the Quantitative Strategic Planning Matrix (QSPM).
Findings/Results: The laboratory demonstrates moderate internal strength and operates within a moderately favorable external environment. The IE Matrix places the laboratory in a hold-and-maintain position, indicating market penetration and service development as appropriate strategic directions. SWOT analysis generated eight alternative strategies. QSPM results identify market differentiation through more comprehensive and specialized testing parameters as the highest-priority strategy.
Conclusion: The laboratory should prioritize parameter-based differentiation, supported by operational efficiency, customer reactivation, retention initiatives, and value-based marketing to strengthen competitiveness in a regulated service market.
Originality/value: This study contributes to strategic management research in laboratory-based services by integrating resource-based, industry-based, and strategy-prioritization frameworks into a sequential and implementable strategy-setting process for a regulated food testing business.

Keywords: business development, differentiation, food testing laboratory, QSPM, strategic management