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Is Innovation In Pricing Your Next Source Of Competitive Advantage Case Study Help

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Is Innovation In Pricing Your Next Source Of Competitive Advantage Case Study Help

Business is currently one of the greatest food chains worldwide. It was founded by Henri Is Innovation In Pricing Your Next Source Of Competitive Advantage in 1866, a German Pharmacist who first introduced "FarineLactee"; a mix of flour and milk to feed infants and reduce mortality rate.
Business is now a transnational company. Unlike other international companies, it has senior executives from different countries and attempts to make decisions considering the whole world. Is Innovation In Pricing Your Next Source Of Competitive Advantage currently has more than 500 factories worldwide and a network spread across 86 countries.

Purpose

The purpose of Is Innovation In Pricing Your Next Source Of Competitive Advantage Corporation is to improve the quality of life of people by playing its part and offering healthy food. It wishes to help the world in shaping a healthy and better future for it. It likewise wants to motivate individuals to live a healthy life. While making certain that the company is prospering in the long run, that's how it plays its part for a better and healthy future

Vision

Is Innovation In Pricing Your Next Source Of Competitive Advantage's vision is to provide its clients with food that is healthy, high in quality and safe to eat. Business imagines to develop a well-trained labor force which would help the company to grow
.

Mission

Is Innovation In Pricing Your Next Source Of Competitive Advantage's objective is that as presently, it is the leading business in the food market, it believes in 'Good Food, Great Life". Its objective is to provide its consumers with a range of options that are healthy and finest in taste. It is focused on offering the very best food to its clients throughout the day and night.

Products.

Is Innovation In Pricing Your Next Source Of Competitive Advantage has a wide range of products that it offers to its clients. In 2011, Business was noted as the most gainful organization.

Goals and Objectives

• Remembering the vision and objective of the corporation, the business has laid down its objectives and goals. These objectives and goals are noted below.
• One goal of the business is to reach absolutely no landfill status. (Business, aboutus, 2017).
• Another objective of Is Innovation In Pricing Your Next Source Of Competitive Advantage is to squander minimum food during production. Usually, the food produced is lost even before it reaches the consumers.
• Another thing that Business is dealing with is to improve its product packaging in such a way that it would help it to minimize those issues and would also ensure the shipment of high quality of its items to its consumers.
• Meet global standards of the environment.
• Build a relationship based upon trust with its customers, company partners, employees, and federal government.

Critical Issues

Just Recently, Business Company is focusing more towards the strategy of NHW and investing more of its revenues 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 greater at the rate of 10% per year and the operating margins to increase by 20%, provided in Display H. There is a need to focus more on the sales then the development technology. Otherwise, it might result in the declined earnings rate. (Henderson, 2012).

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The existing Business technique is based on the idea of Nutritious, Health and Wellness (NHW). This strategy handles the idea to bringing modification in the consumer choices 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 means that the items will have a rating of 60% on the basis of taste and 40% is based upon its nutritional worth. The products will be made with extra dietary value in contrast to all other products in market gaining it a plus on its dietary content.
This strategy was embraced to bring more yummy plus nutritious foods and drinks in market than ever. In competition with other companies, with an intent of retaining its trust over consumers as Business Company has actually gained more relied on by customers.

Quantitative Analysis.

R&D Spending as a portion of sales are declining with increasing actual quantity of spending reveals that the sales are increasing at a higher rate than its R&D costs, and enable the company to more invest in R&D.
Net Profit Margin is increasing while R&D as a percentage of sales is declining. This sign also shows a thumbs-up to the R&D spending, mergers and acquisitions.
Debt ratio of the business is increasing due to its costs on mergers, acquisitions and R&D development rather than payment of financial obligations. This increasing financial obligation ratio posture a threat of default of Business to its financiers and could lead a declining share costs. Therefore, in regards to increasing financial obligation ratio, the company should not invest much on R&D and needs to pay its current debts to reduce the risk for financiers.
The increasing danger of financiers with increasing debt ratio and decreasing share costs can be observed by substantial decline of EPS of Is Innovation In Pricing Your Next Source Of Competitive Advantage stocks.
The sales growth of company is likewise low as compare to its mergers and acquisitions due to slow perception building of consumers. This sluggish development also hinder business 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 up the Exhibits D and E.

TWOS Analysis


2 analysis can be utilized to obtain various techniques based on the SWOT Analysis offered above. A brief summary of TWOS Analysis is given in Exhibit H.

Strategies to exploit Opportunities using Strengths

Business needs to present more innovative items by large amount of R&D Costs and mergers and acquisitions. It might increase the marketplace share of Business and increase the earnings margins for the company. It might also supply Business a long term competitive advantage over its competitors.
The international growth of Business must be focused on market catching of establishing nations by growth, bring in more customers through customer's commitment. As developing nations are more populated than developed countries, it might increase the consumer circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Swot AnalysisIs Innovation In Pricing Your Next Source Of Competitive Advantage should do careful acquisition and merger of companies, as it might affect the consumer's and society's perceptions about Business. It needs to acquire and combine with those business which have a market credibility of healthy and healthy business. It would enhance the perceptions of consumers about Business.
Business should not just invest its R&D on development, rather than it must likewise focus on the R&D costs over evaluation of expense of numerous healthy items. This would increase cost performance of its items, which will lead to increasing its sales, due to decreasing costs, and margins.

Strategies to use strengths to overcome threats

Business needs to move to not only establishing however likewise to developed nations. It needs to broaden its circle to various nations like Unilever which runs in about 170 plus countries.

Strategies to overcome weaknesses to avoid threats

Is Innovation In Pricing Your Next Source Of Competitive Advantage must sensibly control its acquisitions to avoid the danger of misconception from the consumers about Business. It should acquire and combine with those countries having a goodwill of being a healthy company in the market. This would not just enhance the perception of consumers about Business however would likewise increase the sales, revenue margins and market share of Business. It would likewise make it possible for the company to utilize its possible resources efficiently on its other operations rather than acquisitions of those companies slowing the NHW method development.

Segmentation Analysis

Demographic Segmentation

The demographic segmentation of Business is based on 4 aspects; age, gender, income and profession. For example, Business produces numerous items connected to babies i.e. Cerelac, Nido, and so on and related to adults i.e. confectionary items. Is Innovation In Pricing Your Next Source Of Competitive Advantage products are rather cost effective by almost all levels, however its major targeted consumers, in regards to earnings level are middle and upper middle level clients.

Geographical Segmentation

Geographical division of Business is made up of its presence in almost 86 nations. Its geographical segmentation is based upon 2 primary factors i.e. average income level of the customer along with the environment of the region. 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 life style of the client. For example, Business 3 in 1 Coffee target those customers whose life style is rather busy and do not have much time.

Behavioral Segmentation

Is Innovation In Pricing Your Next Source Of Competitive Advantage behavioral division is based upon the mindset understanding and awareness of the consumer. Its highly nutritious items target those consumers who have a health conscious attitude towards their usages.

Is Innovation In Pricing Your Next Source Of Competitive Advantage Alternatives

In order to sustain the brand in the market and keep the client intact with the brand, there are 2 alternatives:
Option: 1
The Company needs to spend more on acquisitions than on the R&D.
Pros:
1. Acquisitions would increase total properties of the business, increasing the wealth of the company. Spending on R&D would be sunk cost.
2. The business can resell the gotten systems in the market, if it fails to execute its method. Quantity invest on the R&D could not be restored, and it will be thought about completely sunk expense, if it do not give prospective results.
3. Spending on R&D provide sluggish growth in sales, as it takes very long time to present an item. Nevertheless, acquisitions provide fast results, as it offer the business already established item, which can be marketed right 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 deal with mistaken belief of customers about Business core worths of healthy and healthy items.
2 Large spending on acquisitions than R&D would send a signal of business's ineffectiveness of developing ingenious items, and would outcomes in consumer's discontentment.
3. Big acquisitions than R&D would extend the product line of the business by the products which are already present in the market, making business unable to present new ingenious products.
Alternative: 2.
The Company needs to spend more on its R&D instead of acquisitions.
Pros:
1. It would allow the company to produce more ingenious items.
2. It would offer the business a strong competitive position in the market.
3. It would make it possible for the business to increase its targeted clients by introducing those products which can be provided to a completely new market sector.
4. Innovative products will provide long term advantages and high market share in long term.
Cons:
1. It would decrease the revenue margins of the business.
2. In case of failure, the whole costs on R&D would be considered as sunk cost, and would affect the company at large. The threat is not when it comes to acquisitions.
3. It would not increase the wealth of business, which might offer a negative signal to the financiers, and could result I declining stock costs.
Alternative 3:
Continue its acquisitions and mergers with substantial costs on in R&D Program.
Vrio AnalysisPros:
1. It would permit the company to present new ingenious items with less danger of converting the spending on R&D into sunk expense.
2. It would provide a positive signal to the financiers, as the overall possessions of the business would increase with its substantial R&D spending.
3. It would not impact the revenue margins of the business at a large rate as compare to alternative 2.
4. It would supply the company a strong long term market position in regards to the business's overall wealth in addition to in regards to ingenious products.
Cons:
1. Danger of conversion of R&D costs into sunk cost, higher than alternative 1 lower than alternative 2.
2. Risk of misunderstanding about the acquisitions, higher than alternative 2 and lesser than option 1.
3. Introduction of less variety of innovative products than alternative 2 and high number of innovative items than alternative 1.

Is Innovation In Pricing Your Next Source Of Competitive Advantage Conclusion

RecommendationsBusiness has stayed the leading market gamer for more than a years. It has actually institutionalized its techniques and culture to align itself with the market modifications and client habits, which has ultimately permitted it to sustain its market share. Though, Business has developed substantial market share and brand identity in the urban markets, it is recommended that the company must concentrate on the backwoods in terms of developing brand name loyalty, awareness, and equity, such can be done by producing a particular brand allocation strategy through trade marketing techniques, that draw clear difference between Is Innovation In Pricing Your Next Source Of Competitive Advantage items and other competitor products. Is Innovation In Pricing Your Next Source Of Competitive Advantage must 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 permit the company to develop brand name equity for newly introduced and currently produced products on a higher platform, making the reliable usage of resources and brand image in the market.

Is Innovation In Pricing Your Next Source Of Competitive Advantage Exhibits

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

Transforming criteria of international food.
Improved market share.
Transforming assumption towards much healthier items
Improvements in R&D as well as QA departments.

Intro of E-marketing.
No such effect as it is beneficial.
Problems over recycling.

Use resources.

Competitor Analysis
Business Unilever PLC Kraft Foods Incorporation DANONE
Sales Growth Greatest given that 1000
Highest after Service with much less development than Service 6th Cheapest
R&D Spending Highest possible considering that 2009 Greatest after Company 1st Lowest
Net Profit Margin Highest given that 2006 with fast growth from 2006 to 2015 Because of sale of Alcon in 2019. Virtually equal to Kraft Foods Incorporation Virtually equal to Unilever N/A
Competitive Advantage Food with Nourishment and also health element Greatest number of brand names with lasting techniques Biggest confectionary as well as refined foods brand name worldwide Largest milk products as well as bottled water brand name worldwide
Segmentation Center and top center degree customers worldwide Private customers in addition to house team Any age and also Income Consumer Teams Center as well as upper center level customers worldwide
Number of Brands 6th 2nd 8th 8th

Quantitative Analysis​
Analysis of Financial Statements (In Millions of CHF)
2006 2007 2008 2009 2010
Sales Revenue 95128 312288 877197 986334 114918
Net Profit Margin 5.71% 5.23% 77.53% 9.99% 62.69%
EPS (Earning Per Share) 87.64 2.65 2.14 7.54 62.76
Total Asset 944674 641936 399739 644277 34189
Total Debt 77481 53868 92232 95534 89211
Debt Ratio 67% 58% 94% 29% 43%
R&D Spending 7938 7518 6822 7975 4125
R&D Spending as % of Sales 9.77% 3.55% 7.46% 6.58% 4.34%

Is Innovation In Pricing Your Next Source Of Competitive Advantage Executive Summary Is Innovation In Pricing Your Next Source Of Competitive Advantage Swot Analysis Is Innovation In Pricing Your Next Source Of Competitive Advantage Vrio Analysis Is Innovation In Pricing Your Next Source Of Competitive Advantage Pestel Analysis
Is Innovation In Pricing Your Next Source Of Competitive Advantage Porters Analysis Is Innovation In Pricing Your Next Source Of Competitive Advantage Recommendations