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Urban Water Partners A Case Study Solution

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Urban Water Partners A Case Study Analysis

Business is presently one of the greatest food chains worldwide. It was established by Henri Urban Water Partners A in 1866, a German Pharmacist who first launched "FarineLactee"; a combination of flour and milk to feed babies and decrease mortality rate.
Business is now a transnational business. Unlike other multinational business, it has senior executives from different countries and tries to make decisions thinking about the entire world. Urban Water Partners A presently has more than 500 factories worldwide and a network spread throughout 86 nations.

Purpose

The purpose of Business Corporation is to boost the quality of life of individuals 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

Vision

Urban Water Partners A's vision is to provide its consumers with food that is healthy, high in quality and safe to consume. It wants to be innovative and simultaneously comprehend the needs and requirements of its consumers. Its vision is to grow fast and supply items that would satisfy the needs of each age. Urban Water Partners A pictures to develop a trained workforce which would help the company to grow
.

Mission

Urban Water Partners A's mission is that as presently, it is the leading company in the food market, it thinks in 'Great Food, Excellent Life". Its objective is to offer its consumers with a range of choices that are healthy and finest in taste too. It is focused on offering the best food to its consumers throughout the day and night.

Products.

Business has a large range of products that it uses to its customers. Its products include food for babies, cereals, dairy products, treats, chocolates, food for pet and mineral water. It has around 4 hundred and fifty (450) factories around the globe and around 328,000 employees. In 2011, Business was noted as the most gainful organization.

Goals and Objectives

• Keeping in mind the vision and objective of the corporation, the company has actually put down its goals and objectives. These objectives and goals are noted below.
• One goal of the business is to reach no land fill status. It is pursuing zero waste, where no waste of the factory is landfilled. It motivates its employees to take the most out of the spin-offs. (Business, aboutus, 2017).
• Another goal of Urban Water Partners A is to squander minimum food throughout production. Usually, the food produced is wasted even prior to it reaches the customers.
• Another thing that Business is working on is to enhance its packaging in such a way that it would help it to lower the above-mentioned problems and would also guarantee the delivery of high quality of its products to its customers.
• Meet global standards of the environment.
• Construct a relationship based on trust with its customers, business partners, workers, and government.

Critical Issues

Just Recently, Business Company is focusing more towards the technique of NHW and investing more of its profits on the R&D innovation. The country is investing more on acquisitions and mergers to support its NHW technique. 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%, given in Exhibit H. There is a requirement to focus more on the sales then the development technology. Otherwise, it might result in the decreased revenue rate. (Henderson, 2012).

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The current Business technique is based upon the principle of Nutritious, Health and Wellness (NHW). This technique deals with the idea to bringing modification in the client preferences about food and making the food stuff healthier concerning about the health problems.
The vision of this strategy is based upon the key method i.e. 60/40+ which simply implies that the items will have a rating of 60% on the basis of taste and 40% is based on its dietary value. The items will be produced with additional nutritional value in contrast to all other items in market gaining it a plus on its nutritional material.
This method was adopted to bring more tasty plus nutritious foods and beverages in market than ever. In competition with other companies, with an intention of retaining its trust over clients as Business Business has gotten 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 permit the business to more invest in R&D.
Net Earnings Margin is increasing while R&D as a portion of sales is decreasing. This sign also reveals a green light to the R&D costs, mergers and acquisitions.
Debt ratio of the company 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 could lead a declining share costs. In terms of increasing financial obligation ratio, the firm should not spend much on R&D and needs to pay its current financial obligations to decrease the danger for investors.
The increasing threat of financiers with increasing financial obligation ratio and decreasing share costs can be observed by huge decline of EPS of Urban Water Partners A stocks.
The sales growth of company is likewise low as compare to its mergers and acquisitions due to slow perception building of customers. This slow development also prevent business to further invest in its mergers and acquisitions.( Business, Business Financial Reports, 2006-2010).
Note: All the above analysis is done on the basis of estimations and Charts given in the Exhibits D and E.

TWOS Analysis


2 analysis can be used to obtain numerous techniques based upon the SWOT Analysis offered above. A brief summary of TWOS Analysis is given up Exhibition H.

Strategies to exploit Opportunities using Strengths

Business must introduce more ingenious products by large amount of R&D Spending and mergers and acquisitions. It could increase the market share of Business and increase the earnings margins for the company. It might likewise supply Business a long term competitive benefit over its rivals.
The global expansion of Business should be focused on market capturing of establishing nations by growth, attracting more customers through customer's commitment. As developing countries are more populous than industrialized nations, it might increase the client circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Swot AnalysisUrban Water Partners A needs to do careful acquisition and merger of organizations, as it might impact the customer's and society's understandings about Business. It needs to acquire and merge with those companies which have a market reputation of healthy and nutritious business. It would improve the perceptions of consumers about Business.
Business must not only invest its R&D on innovation, instead of it ought to likewise concentrate on the R&D costs over examination of expense of numerous nutritious products. This would increase expense effectiveness of its items, which will result in increasing its sales, due to decreasing costs, and margins.

Strategies to use strengths to overcome threats

Business must move to not just establishing but also to industrialized countries. It must widen its circle to different countries like Unilever which runs in about 170 plus countries.

Strategies to overcome weaknesses to avoid threats

Urban Water Partners A must carefully manage its acquisitions to avoid the threat of mistaken belief from the consumers about Business. It ought to get and combine with those countries having a goodwill of being a healthy company in the market. This would not only enhance the understanding of customers about Business however would also increase the sales, earnings margins and market share of Business. It would likewise allow the company to use its possible resources efficiently on its other operations rather than acquisitions of those organizations slowing the NHW technique development.

Segmentation Analysis

Demographic Segmentation

The market segmentation of Business is based on four elements; age, gender, earnings and occupation. For example, Business produces a number of products related to children i.e. Cerelac, Nido, and so on and related to grownups i.e. confectionary products. Urban Water Partners A items are rather budget-friendly by nearly all levels, but its significant targeted consumers, in regards to income level are middle and upper middle level clients.

Geographical Segmentation

Geographical division of Business is made up of its existence in almost 86 nations. Its geographical segmentation is based upon 2 main factors i.e. average income level of the customer as well as the climate of the region. Singapore Business Business's division is done on the basis of the weather of the area i.e. hot, warm or cold.

Psychographic Segmentation

Psychographic division of Business is based upon the character and life style of the customer. Business 3 in 1 Coffee target those consumers whose life design is quite hectic and don't have much time.

Behavioral Segmentation

Urban Water Partners A behavioral division is based upon the mindset understanding and awareness of the consumer. Its highly healthy items target those consumers who have a health mindful mindset towards their usages.

Urban Water Partners A Alternatives

In order to sustain the brand in the market and keep the customer intact with the brand, there are 2 choices:
Alternative: 1
The Company must spend more on acquisitions than on the R&D.
Pros:
1. Acquisitions would increase overall possessions of the business, increasing the wealth of the business. Costs on R&D would be sunk cost.
2. The company can resell the obtained units in the market, if it stops working to execute its method. Amount spend on the R&D could not be restored, and it will be thought about completely sunk expense, if it do not provide possible outcomes.
3. Spending on R&D provide sluggish development in sales, as it takes very long time to present an item. Acquisitions offer quick results, as it offer the company currently developed product, which can be marketed soon after the acquisition.
Cons:
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 products.
2 Big spending on acquisitions than R&D would send a signal of business's inefficiency of establishing innovative items, and would results in consumer's discontentment also.
3. Large acquisitions than R&D would extend the product line of the business by the items which are currently present in the market, making business unable to present new innovative products.
Option: 2.
The Company should invest more on its R&D instead of acquisitions.
Pros:
1. It would allow the business to produce more ingenious items.
2. It would provide the company a strong competitive position in the market.
3. It would make it possible for the company to increase its targeted consumers by presenting those products which can be offered to a totally brand-new market segment.
4. Ingenious items will supply long term benefits and high market share in long term.
Cons:
1. It would decrease the earnings margins of the company.
2. In case of failure, the whole spending on R&D would be thought about as sunk cost, and would impact the company at large. The danger is not in the case of acquisitions.
3. It would not increase the wealth of business, which might offer an unfavorable 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 ingenious items with less threat of converting the spending on R&D into sunk cost.
2. It would offer a positive signal to the investors, as the general possessions of the company would increase with its considerable R&D spending.
3. It would not impact the profit margins of the business at a big rate as compare to alternative 2.
4. It would supply the business a strong long term market position in terms of the business's overall wealth as well as in terms of innovative items.
Cons:
1. Danger of conversion of R&D costs into sunk cost, higher than option 1 lesser than alternative 2.
2. Danger of misunderstanding about the acquisitions, greater than alternative 2 and lesser than option 1.
3. Intro of less variety of innovative products than alternative 2 and high variety of ingenious items than alternative 1.

Urban Water Partners A Conclusion

RecommendationsBusiness has stayed the leading market gamer for more than a decade. It has actually institutionalised its strategies and culture to align itself with the market changes and consumer behavior, which has actually ultimately enabled it to sustain its market share. Business has established considerable market share and brand identity in the urban markets, it is suggested that the company ought to focus on the rural locations in terms of developing brand name commitment, awareness, and equity, such can be done by creating a specific brand name allocation method through trade marketing tactics, that draw clear distinction in between Urban Water Partners A items and other competitor products. Urban Water Partners A needs to leverage its brand image of safe and healthy food in catering the rural markets and also to upscale the offerings in other classifications such as nutrition. This will allow the company to establish brand name equity for recently introduced and already produced items on a higher platform, making the reliable use of resources and brand name image in the market.

Urban Water Partners A Exhibits

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

Transforming criteria of global food.
Improved market share.
Transforming assumption in the direction of much healthier items
Improvements in R&D and also QA departments.

Introduction of E-marketing.
No such impact as it is beneficial.
Issues over recycling.

Use sources.

Competitor Analysis
Business Unilever PLC Kraft Foods Incorporation DANONE
Sales Growth Highest considering that 5000
Greatest after Service with less growth than Business 7th Least expensive
R&D Spending Highest because 2001 Highest possible after Business 2nd Lowest
Net Profit Margin Greatest since 2005 with fast development from 2005 to 2016 Because of sale of Alcon in 2015. Nearly equal to Kraft Foods Consolidation Nearly equal to Unilever N/A
Competitive Advantage Food with Nutrition and health aspect Highest possible variety of brands with sustainable techniques Largest confectionary and also refined foods brand worldwide Largest milk items and mineral water brand worldwide
Segmentation Middle and top middle level consumers worldwide Private consumers together with house group Any age and also Revenue Client Teams Middle as well as upper center degree customers worldwide
Number of Brands 8th 2nd 6th 3rd

Quantitative Analysis​
Analysis of Financial Statements (In Millions of CHF)
2006 2007 2008 2009 2010
Sales Revenue 92482 588511 427536 641831 358472
Net Profit Margin 8.59% 9.37% 23.64% 8.26% 24.82%
EPS (Earning Per Share) 33.72 5.31 3.25 3.35 38.42
Total Asset 263174 265893 269212 753284 95962
Total Debt 81891 82662 95516 39771 47231
Debt Ratio 74% 59% 15% 38% 48%
R&D Spending 5331 8191 2863 1918 7944
R&D Spending as % of Sales 4.15% 7.68% 1.13% 6.22% 8.82%

Urban Water Partners A Executive Summary Urban Water Partners A Swot Analysis Urban Water Partners A Vrio Analysis Urban Water Partners A Pestel Analysis
Urban Water Partners A Porters Analysis Urban Water Partners A Recommendations