Menu

Julian Bond Common Cause Case Study Solution

Case Study Solution And Analysis


Home >> Ivey >> Julian Bond Common Cause >>

Julian Bond Common Cause Case Study Analysis

Business is presently one of the greatest food chains worldwide. It was founded by Henri Julian Bond Common Cause in 1866, a German Pharmacist who initially introduced "FarineLactee"; a combination of flour and milk to feed infants and reduce mortality rate.
Business is now a multinational business. Unlike other multinational business, it has senior executives from different countries and tries to make choices considering the entire world. Julian Bond Common Cause presently has more than 500 factories worldwide and a network spread throughout 86 countries.

Purpose

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

Vision

Julian Bond Common Cause's vision is to provide its consumers with food that is healthy, high in quality and safe to consume. It wishes to be innovative and all at once comprehend the requirements and requirements of its consumers. Its vision is to grow quickly and offer products that would please the requirements of each age group. Julian Bond Common Cause envisions to develop a well-trained workforce which would help the business to grow
.

Mission

Julian Bond Common Cause's mission is that as presently, it is the leading business in the food industry, it believes in 'Great Food, Good 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 consumers throughout the day and night.

Products.

Julian Bond Common Cause has a wide range of items that it provides to its customers. In 2011, Business was listed as the most rewarding company.

Goals and Objectives

• Bearing in mind the vision and objective of the corporation, the business has set its objectives and goals. These goals and goals are noted below.
• One goal of the company is to reach absolutely no garbage dump status. It is working toward absolutely no 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 objective of Julian Bond Common Cause is to lose minimum food during production. Frequently, the food produced is squandered even before it reaches the clients.
• Another thing that Business is working on is to enhance its packaging in such a method that it would help it to decrease the above-mentioned issues and would also guarantee the delivery of high quality of its items to its consumers.
• Meet global requirements of the environment.
• Build a relationship based on trust with its consumers, service partners, workers, and government.

Critical Issues

Recently, Business Business is focusing more towards the method of NHW and investing more of its earnings on the R&D innovation. The country is investing more on acquisitions and mergers to support its NHW strategy. 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. There is a need to focus more on the sales then the innovation technology. Otherwise, it might lead to the declined revenue rate. (Henderson, 2012).

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The current Business method is based upon the idea of Nutritious, Health and Wellness (NHW). This method handles the idea to bringing modification in the consumer preferences about food and making the food things healthier concerning about the health problems.
The vision of this technique is based upon the secret technique i.e. 60/40+ which just implies that the items will have a score of 60% on the basis of taste and 40% is based on its dietary value. The items will be made with additional dietary worth in contrast to all other items in market getting it a plus on its nutritional content.
This technique was embraced to bring more delicious plus nutritious foods and drinks in market than ever. In competitors with other business, with an intention of keeping its trust over clients as Business Business has gotten more relied on by costumers.

Quantitative Analysis.

R&D Spending as a percentage of sales are declining with increasing actual quantity of costs shows that the sales are increasing at a higher rate than its R&D spending, and enable the company to more spend on R&D.
Net Earnings Margin is increasing while R&D as a portion of sales is decreasing. This indication also reveals a green light to the R&D spending, mergers and acquisitions.
Financial obligation ratio of the company is increasing due to its spending on mergers, acquisitions and R&D development rather than payment of financial obligations. This increasing financial obligation ratio pose a danger of default of Business to its investors and could lead a decreasing share costs. Therefore, in regards to increasing debt ratio, the company must not invest much on R&D and ought to pay its current financial obligations to decrease the risk for financiers.
The increasing risk of financiers with increasing debt ratio and decreasing share costs can be observed by big decrease of EPS of Julian Bond Common Cause stocks.
The sales development of business is also low as compare to its mergers and acquisitions due to slow perception building of consumers. This slow development also impede business to further spend on its mergers and acquisitions.( Business, Business Financial Reports, 2006-2010).
Keep in mind: All the above analysis is done on the basis of computations and Charts given in the Exhibitions D and E.

TWOS Analysis


TWOS analysis can be utilized to derive different techniques based upon the SWOT Analysis provided above. A short summary of TWOS Analysis is given in Exhibit H.

Strategies to exploit Opportunities using Strengths

Business ought to introduce more innovative products by large quantity of R&D Spending and mergers and acquisitions. It could increase the market share of Business and increase the revenue margins for the business. It could likewise provide Business a long term competitive advantage over its competitors.
The international expansion of Business ought to be focused on market recording of establishing nations by growth, bring in more customers through client's commitment. As establishing nations are more populated than industrialized nations, it might increase the client circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Swot AnalysisJulian Bond Common Cause needs to do careful acquisition and merger of organizations, as it could affect the consumer's and society's perceptions about Business. It must get and merge with those business which have a market reputation of healthy and healthy business. It would enhance the perceptions of customers about Business.
Business should not just spend its R&D on innovation, instead of it must also focus on the R&D costs over evaluation of cost of numerous healthy products. This would increase expense performance of its products, which will result in increasing its sales, due to decreasing prices, and margins.

Strategies to use strengths to overcome threats

Business ought to move to not just developing but also to developed nations. It should broaden its circle to different nations like Unilever which operates in about 170 plus nations.

Strategies to overcome weaknesses to avoid threats

Julian Bond Common Cause ought to wisely manage its acquisitions to prevent the threat of mistaken belief from the customers about Business. It should obtain and combine with those nations having a goodwill of being a healthy company in the market. This would not only improve the perception of customers about Business but would also increase the sales, revenue margins and market share of Business. It would also allow the company to use its prospective resources effectively on its other operations rather than acquisitions of those organizations slowing the NHW technique growth.

Segmentation Analysis

Demographic Segmentation

The group division of Business is based on 4 aspects; age, gender, earnings and occupation. For example, Business produces a number of products associated with children i.e. Cerelac, Nido, and so on and associated to adults i.e. confectionary items. Julian Bond Common Cause products are rather cost effective by practically all levels, but its major targeted customers, in regards to income level are middle and upper middle level clients.

Geographical Segmentation

Geographical segmentation of Business is composed of its presence in practically 86 nations. Its geographical division is based upon 2 primary factors i.e. typical income level of the customer as well as the climate of the area. For example, Singapore Business Business's segmentation is done on the basis of the weather of the area i.e. hot, warm or cold.

Psychographic Segmentation

Psychographic segmentation of Business is based upon the character and life style of the consumer. Business 3 in 1 Coffee target those clients whose life design is quite busy and do not have much time.

Behavioral Segmentation

Julian Bond Common Cause behavioral segmentation is based upon the mindset understanding and awareness of the consumer. For example its highly nutritious items target those customers who have a health mindful mindset towards their intakes.

Julian Bond Common Cause Alternatives

In order to sustain the brand in the market and keep the client undamaged with the brand, there are two choices:
Alternative: 1
The Business ought to spend more on acquisitions than on the R&D.
Pros:
1. Acquisitions would increase overall possessions of the company, increasing the wealth of the business. Nevertheless, spending on R&D would be sunk cost.
2. The business can resell the obtained units in the market, if it fails to execute its method. Amount invest on the R&D could not be revived, and it will be considered entirely sunk expense, if it do not provide possible results.
3. Investing in R&D offer slow growth in sales, as it takes very long time to introduce an item. Acquisitions provide quick outcomes, as it supply the business already established product, which can be marketed quickly after the acquisition.
Cons:
1. Acquisition of company's which do not fit with the business's worths like Kraftz foods can lead the business to face misconception of customers about Business core values of healthy and nutritious items.
2 Large spending on acquisitions than R&D would send out a signal of company's inefficiency of developing ingenious items, and would lead to consumer's discontentment too.
3. Big acquisitions than R&D would extend the product line of the company by the products which are already present in the market, making business not able to introduce new innovative products.
Option: 2.
The Business should invest more on its R&D instead of acquisitions.
Pros:
1. It would make it possible for the company to produce more ingenious products.
2. It would provide the business a strong competitive position in the market.
3. It would allow the business to increase its targeted consumers by introducing those items which can be provided to a totally new market sector.
4. Ingenious items will provide long term advantages and high market share in long term.
Cons:
1. It would reduce 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 impact the business at large. The risk is not when it comes to acquisitions.
3. It would not increase the wealth of business, which could offer a negative signal to the investors, and might result I declining stock costs.
Alternative 3:
Continue its acquisitions and mergers with significant costs on in R&D Program.
Vrio AnalysisPros:
1. It would permit the business to introduce new ingenious items with less risk of converting the costs on R&D into sunk expense.
2. It would supply a favorable signal to the investors, as the overall possessions of the business would increase with its significant R&D costs.
3. It would not impact the earnings margins of the business at a large rate as compare to alternative 2.
4. It would provide the business a strong long term market position in regards to the business's total wealth along with in regards to innovative items.
Cons:
1. Danger of conversion of R&D costs into sunk expense, higher than option 1 lower than alternative 2.
2. Threat of mistaken belief about the acquisitions, greater than alternative 2 and lower than alternative 1.
3. Introduction of less variety of ingenious products than alternative 2 and high number of innovative products than alternative 1.

Julian Bond Common Cause Conclusion

RecommendationsIt has institutionalized its methods and culture to align itself with the market modifications and customer behavior, which has actually eventually enabled it to sustain its market share. Business has actually developed significant market share and brand identity in the metropolitan markets, it is advised that the company needs to focus on the rural locations in terms of establishing brand name loyalty, awareness, and equity, such can be done by developing a specific brand name allocation technique through trade marketing tactics, that draw clear distinction in between Julian Bond Common Cause products and other competitor items.

Julian Bond Common Cause Exhibits

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

Changing requirements of international food.
Boosted market share.
Transforming perception in the direction of much healthier products
Improvements in R&D as well as QA departments.

Intro of E-marketing.
No such influence as it is beneficial.
Issues over recycling.

Use resources.

Competitor Analysis
Business Unilever PLC Kraft Foods Incorporation DANONE
Sales Growth Highest considering that 8000
Highest possible after Service with much less development than Organisation 4th Cheapest
R&D Spending Highest because 2003 Greatest after Company 4th Cheapest
Net Profit Margin Highest because 2006 with rapid growth from 2008 to 2019 Because of sale of Alcon in 2017. Almost equal to Kraft Foods Consolidation Virtually equal to Unilever N/A
Competitive Advantage Food with Nutrition and health element Greatest number of brand names with sustainable methods Biggest confectionary and also processed foods brand name on the planet Largest dairy products and also mineral water brand worldwide
Segmentation Middle and also top center level customers worldwide Specific clients in addition to household team Any age and also Earnings Client Groups Middle as well as upper middle degree customers worldwide
Number of Brands 8th 3rd 1st 1st

Quantitative Analysis​
Analysis of Financial Statements (In Millions of CHF)
2006 2007 2008 2009 2010
Sales Revenue 52887 632762 852135 222761 844146
Net Profit Margin 2.98% 2.18% 22.57% 3.58% 53.11%
EPS (Earning Per Share) 49.17 9.85 3.39 4.24 33.78
Total Asset 666556 543465 316768 454359 22562
Total Debt 99633 67457 73649 42284 91283
Debt Ratio 85% 26% 42% 82% 97%
R&D Spending 3151 9799 4531 8122 8593
R&D Spending as % of Sales 3.26% 1.61% 2.21% 5.43% 6.68%

Julian Bond Common Cause Executive Summary Julian Bond Common Cause Swot Analysis Julian Bond Common Cause Vrio Analysis Julian Bond Common Cause Pestel Analysis
Julian Bond Common Cause Porters Analysis Julian Bond Common Cause Recommendations