Porter's generic strategies

Allie Haroum is the owner of a small independent café in Sydney. Her café serves the local inner-city, which has an increasing number of female office workers. She sells high quality European and Middle Eastern food. A larger food court has just opened across the street from her store. It sells American and Australian fast food and offers lower prices on its food. It is a no-frills operation and its lower prices are attracting business away from Allie's café. Assume you are part of a student team assigned to do management accounting class project for Allie. Her question for the team is: "How can I apply Porter's generic business strategies to better deal with my strategic planning challenges in this situation?" How will you reply?