Menu

Beta Golf Case Study Solution

Case Study Solution And Analysis


Home >> Darden >> Beta Golf >>

Beta Golf Case Study Help

Business is currently one of the most significant food chains worldwide. It was founded by Henri Beta Golf in 1866, a German Pharmacist who initially launched "FarineLactee"; a combination of flour and milk to feed babies and reduce death rate.
Business is now a multinational business. Unlike other multinational companies, it has senior executives from various countries and attempts to make decisions thinking about the entire world. Beta Golf currently has more than 500 factories around the world and a network spread throughout 86 countries.

Purpose

The purpose of Business Corporation is to boost the quality of life of people by playing its part and providing healthy food. While making sure that the business is being successful in the long run, that's how it plays its part for a better and healthy future

Vision

Beta Golf's vision is to supply its consumers with food that is healthy, high in quality and safe to consume. It wants to be ingenious and at the same time comprehend the requirements and requirements of its consumers. Its vision is to grow quick and offer products that would please the needs of each age. Beta Golf pictures to develop a well-trained workforce which would help the company to grow
.

Mission

Beta Golf's mission is that as currently, it is the leading business in the food market, it thinks in 'Excellent Food, Excellent Life". Its mission is to provide its customers with a range of choices that are healthy and finest in taste. It is focused on offering the best food to its clients throughout the day and night.

Products.

Business has a wide range of products that it provides to its clients. Its products include food for babies, cereals, dairy products, snacks, chocolates, food for animal and bottled water. It has around four hundred and fifty (450) factories around the world and around 328,000 staff members. In 2011, Business was listed as the most rewarding company.

Goals and Objectives

• Bearing in mind the vision and objective of the corporation, the company has actually set its objectives and goals. These objectives and goals are listed below.
• One goal of the business is to reach no garbage dump status. (Business, aboutus, 2017).
• Another objective of Beta Golf is to waste minimum food during production. Frequently, the food produced is lost even before it reaches the clients.
• Another thing that Business is dealing with is to enhance its product packaging in such a way that it would help it to lower those complications and would likewise guarantee the delivery of high quality of its items to its consumers.
• Meet worldwide standards of the environment.
• Develop a relationship based on trust with its consumers, organisation partners, staff members, and government.

Critical Issues

Recently, Business Company is focusing more towards the method of NHW and investing more of its profits on the R&D technology. The nation is investing more on acquisitions and mergers to support its NHW method. The target of the company is not accomplished as the sales were expected to grow higher at the rate of 10% per year and the operating margins to increase by 20%, offered in Exhibition H.

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The current Business strategy is based on the principle of Nutritious, Health and Wellness (NHW). This strategy deals with the concept to bringing modification in the customer choices about food and making the food things healthier concerning about the health concerns.
The vision of this strategy is based upon the key approach i.e. 60/40+ which just indicates that the products will have a score of 60% on the basis of taste and 40% is based upon its dietary value. The items will be made with additional dietary worth in contrast to all other products in market getting it a plus on its nutritional content.
This technique was embraced to bring more tasty plus nutritious foods and drinks in market than ever. In competition with other companies, with an intent of maintaining its trust over consumers as Business Company has gotten more trusted by customers.

Quantitative Analysis.

R&D Spending as a percentage of sales are declining with increasing real amount of spending shows that the sales are increasing at a higher rate than its R&D costs, and allow the business to more invest in R&D.
Net Earnings Margin is increasing while R&D as a percentage of sales is decreasing. This indication also reveals a green light to the R&D spending, mergers and acquisitions.
Financial obligation ratio of the business is increasing due to its spending on mergers, acquisitions and R&D development rather than payment of debts. This increasing financial obligation ratio posture a danger of default of Business to its investors and might lead a decreasing share rates. In terms of increasing financial obligation ratio, the company must not invest much on R&D and should pay its existing debts to reduce the risk for financiers.
The increasing danger of financiers with increasing debt ratio and decreasing share prices can be observed by huge decrease of EPS of Beta Golf stocks.
The sales growth of company is likewise low as compare to its mergers and acquisitions due to slow perception structure of consumers. This slow development also prevent business to more invest in its mergers and acquisitions.( Business, Business Financial Reports, 2006-2010).
Note: All the above analysis is done on the basis of calculations and Charts given up the Exhibitions D and E.

TWOS Analysis


2 analysis can be used to derive various strategies based on the SWOT Analysis offered above. A quick summary of TWOS Analysis is given up Exhibition H.

Strategies to exploit Opportunities using Strengths

Business should present more ingenious items by big amount of R&D Costs and mergers and acquisitions. It might increase the market share of Business and increase the revenue margins for the business. It could also offer Business a long term competitive advantage over its rivals.
The global expansion of Business ought to be focused on market catching of establishing countries by growth, drawing in more consumers through customer's commitment. As establishing nations are more populous than developed nations, it could increase the client circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Swot AnalysisBeta Golf should do cautious acquisition and merger of companies, as it might affect the customer's and society's understandings about Business. It ought to acquire and merge with those companies which have a market reputation of healthy and healthy business. It would enhance the perceptions of consumers about Business.
Business needs to not just invest its R&D on innovation, rather than it must likewise focus on the R&D spending over examination of expense of various healthy items. This would increase cost performance of its items, which will result in increasing its sales, due to declining costs, and margins.

Strategies to use strengths to overcome threats

Business must relocate to not just developing however likewise to industrialized nations. It should broadens its geographical expansion. This large geographical growth towards establishing and established nations would minimize the risk of potential losses in times of instability in various nations. It needs to broaden its circle to numerous nations like Unilever which operates in about 170 plus nations.

Strategies to overcome weaknesses to avoid threats

Beta Golf must carefully control its acquisitions to avoid the danger of misunderstanding from the consumers about Business. It ought to obtain and combine with those countries having a goodwill of being a healthy company in the market. This would not only enhance the perception of consumers about Business however would likewise increase the sales, earnings margins and market share of Business. It would likewise enable the company to utilize its potential resources efficiently on its other operations instead of acquisitions of those organizations slowing the NHW technique development.

Segmentation Analysis

Demographic Segmentation

The demographic segmentation of Business is based on 4 factors; age, gender, earnings and occupation. For instance, Business produces numerous products connected to infants i.e. Cerelac, Nido, and so on and related to adults i.e. confectionary items. Beta Golf items are quite economical by practically all levels, but its significant targeted clients, in terms of income level are middle and upper middle level consumers.

Geographical Segmentation

Geographical division of Business is composed of its presence in almost 86 countries. Its geographical division is based upon two main elements i.e. typical income level of the customer in addition to the climate of the region. For instance, Singapore Business Business's segmentation is done on the basis of the weather of the region i.e. hot, warm or cold.

Psychographic Segmentation

Psychographic division of Business is based upon the personality and lifestyle of the client. Business 3 in 1 Coffee target those customers whose life design is rather hectic and do not have much time.

Behavioral Segmentation

Beta Golf behavioral division is based upon the attitude knowledge and awareness of the consumer. For example its highly nutritious products target those customers who have a health mindful mindset towards their intakes.

Beta Golf Alternatives

In order to sustain the brand name in the market and keep the client intact with the brand name, there are 2 alternatives:
Alternative: 1
The Business ought to invest more on acquisitions than on the R&D.
Pros:
1. Acquisitions would increase overall properties of the business, increasing the wealth of the business. Nevertheless, costs on R&D would be sunk expense.
2. The business can resell the acquired systems in the market, if it fails to execute its strategy. Amount spend on the R&D could not be revived, and it will be thought about entirely sunk expense, if it do not give possible results.
3. Investing in R&D provide slow growth in sales, as it takes long period of time to present a product. Acquisitions supply quick results, as it supply the company currently established product, which can be marketed quickly after the acquisition.
Cons:
1. Acquisition of business's which do not fit with the business's values like Kraftz foods can lead the business to face misconception of consumers about Business core worths of healthy and healthy products.
2 Big costs on acquisitions than R&D would send a signal of business's inefficiency of establishing innovative items, and would results in consumer's discontentment as well.
3. Large acquisitions than R&D would extend the product line of the company by the items which are currently present in the market, making business not able to present new innovative items.
Option: 2.
The Company must invest more on its R&D instead of acquisitions.
Pros:
1. It would enable the business to produce more innovative products.
2. It would offer the company a strong competitive position in the market.
3. It would enable the company to increase its targeted clients by introducing those items which can be offered to a totally brand-new market segment.
4. Innovative products will provide long term benefits and high market share in long run.
Cons:
1. It would reduce the revenue margins of the company.
2. In case of failure, the entire costs on R&D would be thought about as sunk expense, and would affect the company at big. The danger is not when it comes to acquisitions.
3. It would not increase the wealth of company, which might provide an unfavorable signal to the investors, and might result I decreasing stock costs.
Alternative 3:
Continue its acquisitions and mergers with substantial spending on in R&D Program.
Vrio AnalysisPros:
1. It would permit the business to present brand-new ingenious items with less threat of transforming the spending on R&D into sunk cost.
2. It would supply a favorable signal to the investors, as the general properties of the business would increase with its significant R&D costs.
3. It would not affect the revenue margins of the company at a big rate as compare to alternative 2.
4. It would offer the company a strong long term market position in regards to the business's general wealth in addition to in terms of ingenious items.
Cons:
1. Risk of conversion of R&D costs into sunk cost, higher than alternative 1 lesser than alternative 2.
2. Risk of misconception about the acquisitions, greater than alternative 2 and lower than alternative 1.
3. Introduction of less variety of innovative products than alternative 2 and high number of innovative products than alternative 1.

Beta Golf Conclusion

RecommendationsIt has institutionalised its methods and culture to align itself with the market changes and customer behavior, which has actually ultimately permitted it to sustain its market share. Business has developed substantial market share and brand name identity in the metropolitan markets, it is advised that the business needs to focus on the rural locations in terms of establishing brand commitment, awareness, and equity, such can be done by creating a particular brand name allowance method through trade marketing techniques, that draw clear distinction between Beta Golf products and other rival items.

Beta Golf Exhibits

PESTEL Analysis
P
Political
E
Economic
S
Social
T
Technology
L
Legal
E
Environment
Governmental support

Altering requirements of worldwide food.
Enhanced market share.
Transforming understanding towards healthier products
Improvements in R&D as well as QA departments.

Introduction of E-marketing.
No such influence as it is good.
Worries over recycling.

Use of resources.

Competitor Analysis
Business Unilever PLC Kraft Foods Incorporation DANONE
Sales Growth Highest possible since 5000
Highest possible after Service with less development than Organisation 7th Least expensive
R&D Spending Greatest since 2003 Highest after Service 9th Lowest
Net Profit Margin Greatest considering that 2005 with fast development from 2002 to 2018 Because of sale of Alcon in 2017. Practically equal to Kraft Foods Unification Almost equal to Unilever N/A
Competitive Advantage Food with Nutrition as well as health and wellness element Greatest variety of brands with lasting techniques Biggest confectionary and processed foods brand on the planet Largest milk products and bottled water brand name in the world
Segmentation Middle and upper middle level consumers worldwide Specific consumers together with house team Every age and Income Client Groups Center as well as upper center degree customers worldwide
Number of Brands 5th 4th 5th 1st

Quantitative Analysis​
Analysis of Financial Statements (In Millions of CHF)
2006 2007 2008 2009 2010
Sales Revenue 43924 967655 912178 685648 971922
Net Profit Margin 1.25% 1.45% 57.51% 4.37% 78.21%
EPS (Earning Per Share) 76.35 9.82 5.82 9.73 54.34
Total Asset 199426 933785 261567 881434 46431
Total Debt 48184 25321 41395 99468 92541
Debt Ratio 87% 12% 17% 57% 78%
R&D Spending 9273 8658 7249 4341 2767
R&D Spending as % of Sales 5.91% 5.44% 4.78% 2.59% 5.36%

Beta Golf Executive Summary Beta Golf Swot Analysis Beta Golf Vrio Analysis Beta Golf Pestel Analysis
Beta Golf Porters Analysis Beta Golf Recommendations