Satelite Distribuidora De Petroleo Case Study Solution

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Satelite Distribuidora De Petroleo Case Study Analysis

Satelite Distribuidora De Petroleo is currently one of the most significant food cycle worldwide. It was founded by Harvard in 1866, a German Pharmacist who initially introduced "FarineLactee"; a mix of flour and milk to feed babies and reduce mortality rate. At the very same time, the Page bros from Switzerland also found The Anglo-Swiss Condensed Milk Business. The 2 ended up being rivals initially however later merged in 1905, resulting in the birth of Satelite Distribuidora De Petroleo.
Business is now a multinational business. Unlike other international business, it has senior executives from different nations and tries to make decisions thinking about the whole world. Satelite Distribuidora De Petroleo presently has more than 500 factories around the world and a network spread throughout 86 countries.


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


Satelite Distribuidora De Petroleo's vision is to provide its clients with food that is healthy, high in quality and safe to eat. It wishes to be ingenious and at the same time comprehend the requirements and requirements of its consumers. Its vision is to grow fast and offer products that would please the requirements of each age. Satelite Distribuidora De Petroleo visualizes to establish a trained workforce which would help the business to grow


Satelite Distribuidora De Petroleo's mission is that as currently, it is the leading company in the food industry, it believes in 'Great Food, Good Life". Its mission is to supply its consumers with a variety of choices that are healthy and finest in taste. It is focused on supplying the very best food to its customers throughout the day and night.


Satelite Distribuidora De Petroleo has a broad variety of items that it uses to its clients. In 2011, Business was noted as the most rewarding organization.

Goals and Objectives

• Remembering the vision and objective of the corporation, the business has actually put down its goals and objectives. These objectives and objectives are noted below.
• One goal of the company is to reach zero land fill status. (Business, aboutus, 2017).
• Another objective of Satelite Distribuidora De Petroleo is to waste minimum food throughout production. Usually, the food produced is wasted even before it reaches the consumers.
• Another thing that Business is working on is to enhance its packaging in such a method that it would help it to decrease those problems 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 customers, company partners, employees, and federal government.

Critical Issues

Recently, Business Business is focusing more towards the technique of NHW and investing more of its revenues on the R&D technology. The nation is investing more on acquisitions and mergers to support its NHW method. Nevertheless, the target of the company is not achieved as the sales were anticipated to grow higher at the rate of 10% annually and the operating margins to increase by 20%, given up Exhibition H. There is a need to focus more on the sales then the innovation technology. Otherwise, it may lead to the declined revenue rate. (Henderson, 2012).

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The current Business strategy is based upon the concept of Nutritious, Health and Wellness (NHW). This strategy handles the concept to bringing modification in the customer preferences about food and making the food things much healthier concerning about the health issues.
The vision of this strategy is based upon the key approach i.e. 60/40+ which simply suggests that the products will have a rating of 60% on the basis of taste and 40% is based on its dietary worth. The items will be manufactured with extra dietary worth in contrast to all other products in market acquiring it a plus on its dietary material.
This technique was embraced to bring more yummy plus nutritious foods and drinks in market than ever. In competition with other business, with an intent of keeping its trust over consumers as Business Company has gained more relied on by costumers.

Quantitative Analysis.

R&D Spending as a portion of sales are decreasing with increasing actual amount of costs reveals that the sales are increasing at a higher rate than its R&D costs, and enable the business to more invest in R&D.
Net Profit Margin is increasing while R&D as a portion of sales is declining. This indication likewise reveals a green light to the R&D costs, mergers and acquisitions.
Financial obligation ratio of the company is increasing due to its spending on mergers, acquisitions and R&D development instead of payment of financial obligations. This increasing debt ratio present a hazard of default of Business to its investors and might lead a decreasing share costs. Therefore, in regards to increasing financial obligation ratio, the company ought to not invest much on R&D and ought to pay its present debts to reduce the threat for investors.
The increasing risk of financiers with increasing debt ratio and decreasing share prices can be observed by huge decline of EPS of Satelite Distribuidora De Petroleo stocks.
The sales development of business is likewise low as compare to its mergers and acquisitions due to slow perception building of consumers. This sluggish development also impede company to further invest in its mergers and acquisitions.( Business, Business Financial Reports, 2006-2010).
Keep in mind: All the above analysis is done on the basis of estimations and Charts given in the Exhibitions D and E.

TWOS Analysis

TWOS analysis can be used to obtain different strategies based upon the SWOT Analysis given above. A short summary of TWOS Analysis is given up Exhibit H.

Strategies to exploit Opportunities using Strengths

Business ought to introduce more ingenious products by large quantity of R&D Spending and mergers and acquisitions. It might increase the marketplace share of Business and increase the earnings margins for the company. It might also provide Business a long term competitive advantage over its rivals.
The international growth of Business need to be concentrated on market capturing of developing countries by expansion, attracting more clients through client's loyalty. As developing countries are more populous than industrialized countries, it might increase the client circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Swot AnalysisSatelite Distribuidora De Petroleo must do cautious acquisition and merger of organizations, as it might affect the customer's and society's perceptions about Business. It ought to acquire and merge with those business which have a market track record of healthy and nutritious companies. It would enhance the understandings of consumers about Business.
Business should not just invest its R&D on innovation, rather than it must likewise focus on the R&D spending over assessment of expense of different nutritious products. This would increase cost performance of its products, which will result in increasing its sales, due to decreasing rates, and margins.

Strategies to use strengths to overcome threats

Business must move to not only developing but likewise to developed nations. It must widen its circle to various countries like Unilever which operates in about 170 plus nations.

Strategies to overcome weaknesses to avoid threats

Satelite Distribuidora De Petroleo ought to carefully manage its acquisitions to avoid the risk of misunderstanding from the customers about Business. It needs to obtain and merge with those nations having a goodwill of being a healthy business in the market. This would not just enhance the perception of consumers about Business but would likewise increase the sales, earnings margins and market share of Business. It would also make it possible for the business to use its possible resources effectively on its other operations instead of acquisitions of those companies slowing the NHW technique growth.

Segmentation Analysis

Demographic Segmentation

The market segmentation of Business is based on 4 factors; age, gender, income and occupation. For instance, Business produces numerous items related to children i.e. Cerelac, Nido, and so on and related to adults i.e. confectionary items. Satelite Distribuidora De Petroleo items are rather budget friendly by almost all levels, however its major targeted consumers, in regards to earnings level are middle and upper middle level customers.

Geographical Segmentation

Geographical division of Business is composed of its presence in almost 86 countries. Its geographical segmentation is based upon two main factors i.e. typical income level of the customer as well as the environment of the region. Singapore Business Business's segmentation is done on the basis of the weather condition of the region i.e. hot, warm or cold.

Psychographic Segmentation

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

Behavioral Segmentation

Satelite Distribuidora De Petroleo behavioral division is based upon the mindset knowledge and awareness of the customer. For instance its extremely healthy items target those clients who have a health conscious attitude towards their consumptions.

Satelite Distribuidora De Petroleo Alternatives

In order to sustain the brand in the market and keep the client intact with the brand, there are two alternatives:
Alternative: 1
The Business must invest more on acquisitions than on the R&D.
1. Acquisitions would increase total possessions of the business, increasing the wealth of the company. Costs on R&D would be sunk cost.
2. The business can resell the gotten systems in the market, if it fails to implement its technique. Nevertheless, amount invest in the R&D might not be revived, and it will be considered completely sunk expense, if it do not provide potential outcomes.
3. Spending on R&D provide slow growth in sales, as it takes long time to present a product. Acquisitions offer fast results, as it provide the business already developed item, which can be marketed soon after the acquisition.
1. Acquisition of company's which do not fit with the business's values like Kraftz foods can lead the business to face misunderstanding of consumers about Business core values of healthy and healthy items.
2 Large costs on acquisitions than R&D would send out a signal of company's ineffectiveness of establishing innovative items, and would lead to consumer's dissatisfaction as well.
3. Big acquisitions than R&D would extend the line of product of the business by the products which are already present in the market, making company not able to present brand-new ingenious items.
Option: 2.
The Business should invest more on its R&D instead of acquisitions.
1. It would make it possible for the business to produce more innovative items.
2. It would supply the business a strong competitive position in the market.
3. It would allow the business to increase its targeted consumers by introducing those products which can be offered to a completely new market section.
4. Ingenious items will supply long term advantages and high market share in long run.
1. It would decrease the earnings margins of the business.
2. In case of failure, the whole spending on R&D would be thought about as sunk cost, and would affect the business at large. The threat is not when it comes to acquisitions.
3. It would not increase the wealth of business, which might provide a negative signal to the investors, and might result I decreasing stock prices.
Alternative 3:
Continue its acquisitions and mergers with substantial costs on in R&D Program.
Vrio AnalysisPros:
1. It would allow the company to introduce brand-new innovative items with less threat of converting the costs on R&D into sunk cost.
2. It would provide a favorable signal to the investors, as the general properties of the company would increase with its substantial R&D costs.
3. It would not affect the revenue margins of the company at a large rate as compare to alternative 2.
4. It would supply the business a strong long term market position in terms of the company's total wealth along with in terms of ingenious items.
1. Danger of conversion of R&D costs into sunk cost, greater than alternative 1 lower than alternative 2.
2. Threat of mistaken belief about the acquisitions, greater than alternative 2 and lesser than alternative 1.
3. Introduction of less variety of ingenious items than alternative 2 and high variety of innovative products than alternative 1.

Satelite Distribuidora De Petroleo Conclusion

RecommendationsIt has institutionalized its methods and culture to align itself with the market changes and client habits, which has ultimately allowed it to sustain its market share. Business has actually developed significant market share and brand identity in the metropolitan markets, it is recommended that the business ought to focus on the rural areas in terms of developing brand loyalty, awareness, and equity, such can be done by producing a particular brand name allowance method through trade marketing methods, that draw clear difference between Satelite Distribuidora De Petroleo products and other competitor items.

Satelite Distribuidora De Petroleo Exhibits

PESTEL Analysis
Governmental assistance

Altering requirements of international food.
Boosted market share. Changing assumption in the direction of healthier products Improvements in R&D as well as QA divisions.

Intro of E-marketing.
No such impact as it is good. Concerns over recycling.

Use of resources.

Competitor Analysis
Business Unilever PLC Kraft Foods Incorporation DANONE
Sales Growth Highest since 7000 Greatest after Company with less development than Organisation 2nd Least expensive
R&D Spending Greatest because 2001 Highest possible after Company 8th Least expensive
Net Profit Margin Highest considering that 2005 with fast growth from 2009 to 2013 Because of sale of Alcon in 2011. Practically equal to Kraft Foods Incorporation Virtually equal to Unilever N/A
Competitive Advantage Food with Nutrition and also wellness element Greatest number of brands with lasting methods Biggest confectionary and processed foods brand in the world Biggest dairy products and also bottled water brand name on the planet
Segmentation Middle and also upper middle degree consumers worldwide Individual customers in addition to home group Every age as well as Income Customer Groups Middle and also top center level consumers worldwide
Number of Brands 2nd 5th 8th 2nd

Quantitative Analysis​
Analysis of Financial Statements (In Millions of CHF)
2006 2007 2008 2009 2010
Sales Revenue 35348 478487 681128 586819 992392
Net Profit Margin 3.14% 3.63% 36.38% 4.38% 62.85%
EPS (Earning Per Share) 53.85 4.65 1.86 5.24 48.31
Total Asset 651914 176155 392923 545593 55539
Total Debt 66143 75138 25258 88148 51116
Debt Ratio 16% 12% 69% 28% 81%
R&D Spending 8463 7152 8693 5319 1944
R&D Spending as % of Sales 9.91% 1.99% 1.61% 5.52% 5.82%

Executive Summary Swot Analysis Vrio Analysis Pestel Analysis
Porters Analysis Recommendations