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Cambridge Nanotech Case Study Solution

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Cambridge Nanotech is presently one of the greatest food cycle worldwide. It was established by Kelloggs in 1866, a German Pharmacist who initially introduced "FarineLactee"; a combination of flour and milk to feed babies and decrease death rate. At the exact same time, the Page brothers from Switzerland also discovered The Anglo-Swiss Condensed Milk Business. The 2 became competitors initially however later combined in 1905, resulting in the birth of Cambridge Nanotech.
Business is now a transnational business. Unlike other multinational business, it has senior executives from different countries and attempts to make decisions thinking about the entire world. Cambridge Nanotech presently has more than 500 factories around the world and a network spread throughout 86 nations.

Purpose

The purpose of Cambridge Nanotech Corporation is to improve the lifestyle of people by playing its part and offering healthy food. It wishes to help the world in forming a healthy and much better future for it. It likewise wants to encourage individuals to live a healthy life. While ensuring that the company is succeeding in the long run, that's how it plays its part for a much better and healthy future

Vision

Cambridge Nanotech's vision is to supply its customers with food that is healthy, high in quality and safe to eat. It wants to be ingenious and concurrently comprehend the needs and requirements of its customers. Its vision is to grow fast and supply items that would satisfy the needs of each age group. Cambridge Nanotech envisions to develop a well-trained labor force which would help the company to grow
.

Mission

Cambridge Nanotech's objective is that as presently, it is the leading company in the food market, it thinks in 'Great Food, Great Life". Its mission is to provide its customers with a variety of options that are healthy and best in taste as well. It is concentrated on supplying the very best food to its clients throughout the day and night.

Products.

Business has a wide variety of products that it uses to its customers. Its products include food for infants, cereals, dairy products, treats, chocolates, food for pet and mineral water. It has around 4 hundred and fifty (450) factories around the world and around 328,000 staff members. In 2011, Business was listed as the most rewarding organization.

Goals and Objectives

• Bearing in mind the vision and mission of the corporation, the company has actually laid down its goals and objectives. These goals and objectives are noted below.
• One goal of the company is to reach zero landfill status. (Business, aboutus, 2017).
• Another goal of Cambridge Nanotech is to waste minimum food during production. Frequently, the food produced is wasted even before it reaches the consumers.
• Another thing that Business is working on is to improve its packaging in such a way that it would help it to decrease the above-mentioned issues and would likewise guarantee the delivery of high quality of its items to its customers.
• Meet worldwide standards of the environment.
• Build a relationship based upon trust with its consumers, business partners, staff members, and federal government.

Critical Issues

Just Recently, Business Business 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 strategy. The target of the business 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 Exhibit H.

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 method deals with the idea to bringing change in the consumer choices about food and making the food things healthier worrying about the health issues.
The vision of this strategy is based upon the key method i.e. 60/40+ which simply indicates that the items will have a rating of 60% on the basis of taste and 40% is based on its dietary worth. The items will be made with additional nutritional worth in contrast to all other products in market getting it a plus on its nutritional material.
This method was adopted to bring more yummy plus nutritious foods and beverages in market than ever. In competitors with other companies, with an intent of retaining its trust over customers as Business Business has acquired more trusted by costumers.

Quantitative Analysis.

R&D Spending as a percentage of sales are declining with increasing real quantity of spending reveals that the sales are increasing at a higher rate than its R&D costs, and allow the company to more spend on R&D.
Net Profit Margin is increasing while R&D as a percentage of sales is declining. This sign likewise reveals a green light to the R&D spending, mergers and acquisitions.
Financial obligation ratio of the business is increasing due to its costs on mergers, acquisitions and R&D advancement rather than payment of financial obligations. This increasing financial obligation ratio pose a danger of default of Business to its investors and might lead a decreasing share prices. For that reason, in regards to increasing debt ratio, the company ought to not invest much on R&D and needs to pay its present debts to decrease the risk for financiers.
The increasing risk of investors with increasing debt ratio and declining share rates can be observed by substantial decrease of EPS of Cambridge Nanotech stocks.
The sales growth of business is also low as compare to its mergers and acquisitions due to slow understanding structure of customers. This slow 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 up the Exhibits D and E.

TWOS Analysis


2 analysis can be utilized to derive numerous strategies based upon the SWOT Analysis offered above. A quick summary of TWOS Analysis is given in Exhibition H.

Strategies to exploit Opportunities using Strengths

Business must present more innovative products by large quantity of R&D Spending and mergers and acquisitions. It could increase the marketplace share of Business and increase the profit margins for the company. It might also offer Business a long term competitive benefit over its competitors.
The international expansion of Business ought to be focused on market recording of establishing nations by expansion, attracting more clients through consumer's commitment. As developing nations are more populous than developed countries, it might increase the consumer circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Swot AnalysisCambridge Nanotech ought to do mindful acquisition and merger of companies, as it might impact the consumer's and society's perceptions about Business. It must get and combine with those business which have a market track record of healthy and nutritious companies. It would improve the perceptions of customers about Business.
Business should not just spend its R&D on innovation, instead of it must also concentrate on the R&D spending over assessment of cost of various nutritious items. This would increase cost effectiveness of its products, which will result in increasing its sales, due to decreasing prices, and margins.

Strategies to use strengths to overcome threats

Business must move to not just developing however also to industrialized nations. It must expands its geographical expansion. This wide geographical growth towards establishing and developed nations would decrease the danger of potential losses in times of instability in numerous countries. It needs to broaden its circle to numerous nations like Unilever which runs in about 170 plus nations.

Strategies to overcome weaknesses to avoid threats

It should obtain and merge with those nations having a goodwill of being a healthy business in the market. It would likewise enable the business to utilize its potential resources effectively on its other operations rather than acquisitions of those organizations slowing the NHW strategy development.

Segmentation Analysis

Demographic Segmentation

The demographic division of Business is based upon 4 elements; age, gender, earnings and profession. For instance, Business produces a number of items associated with children i.e. Cerelac, Nido, and so on and associated to grownups i.e. confectionary items. Cambridge Nanotech products are quite budget-friendly by practically all levels, however its major targeted consumers, in regards to income level are middle and upper middle level customers.

Geographical Segmentation

Geographical segmentation of Business is made up of its presence in almost 86 nations. Its geographical segmentation is based upon two main elements i.e. typical income level of the customer as well as the climate of the area. For instance, Singapore Business Business's division 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 life style of the consumer. Business 3 in 1 Coffee target those consumers whose life design is rather hectic and don't have much time.

Behavioral Segmentation

Cambridge Nanotech behavioral division is based upon the mindset knowledge and awareness of the consumer. Its extremely healthy items target those customers who have a health conscious mindset towards their consumptions.

Cambridge Nanotech Alternatives

In order to sustain the brand in the market and keep the consumer undamaged with the brand, there are 2 alternatives:
Alternative: 1
The Business must invest more on acquisitions than on the R&D.
Pros:
1. Acquisitions would increase overall assets of the business, increasing the wealth of the business. Nevertheless, costs on R&D would be sunk expense.
2. The business can resell the obtained systems in the market, if it fails to implement its method. Nevertheless, amount invest in the R&D could not be restored, and it will be considered entirely sunk cost, if it do not provide possible outcomes.
3. Spending on R&D provide sluggish development in sales, as it takes very long time to introduce a product. Acquisitions provide fast results, as it provide the business currently established item, which can be marketed quickly 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 mistaken belief of consumers about Business core values of healthy and healthy items.
2 Big costs on acquisitions than R&D would send a signal of business's inadequacy of developing innovative items, and would outcomes in customer's dissatisfaction.
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 Company should invest more on its R&D rather than acquisitions.
Pros:
1. It would enable 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 business to increase its targeted clients by presenting those items which can be provided to a totally new market sector.
4. Ingenious products will supply 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 spending on R&D would be considered as sunk expense, and would affect the company at big. The threat is not in the case of acquisitions.
3. It would not increase the wealth of company, which might offer an unfavorable signal to the investors, and might result I decreasing stock costs.
Alternative 3:
Continue its acquisitions and mergers with significant spending on in R&D Program.
Vrio AnalysisPros:
1. It would permit the company to introduce new innovative items with less risk of transforming the costs on R&D into sunk expense.
2. It would provide a favorable signal to the investors, as the general assets of the company would increase with its considerable R&D spending.
3. It would not impact the earnings margins of the company at a large rate as compare to alternative 2.
4. It would supply the company a strong long term market position in terms of the business's overall wealth in addition to in terms of ingenious items.
Cons:
1. Risk of conversion of R&D spending into sunk cost, higher than alternative 1 lesser than alternative 2.
2. Danger of mistaken belief about the acquisitions, greater than alternative 2 and lower than alternative 1.
3. Introduction of less number of ingenious items than alternative 2 and high number of ingenious items than alternative 1.

Cambridge Nanotech Conclusion

RecommendationsBusiness has actually remained the top market gamer for more than a decade. It has actually institutionalised its methods and culture to align itself with the marketplace modifications and client habits, which has actually ultimately allowed it to sustain its market share. Though, Business has established considerable market share and brand name identity in the metropolitan markets, it is recommended that the business ought to concentrate on the rural areas in terms of developing brand loyalty, awareness, and equity, such can be done by creating a specific brand name allowance technique through trade marketing methods, that draw clear difference between Cambridge Nanotech products and other rival products. Cambridge Nanotech should utilize its brand image of safe and healthy food in catering the rural markets and likewise to upscale the offerings in other categories such as nutrition. This will allow the company to develop brand equity for freshly introduced and currently produced items on a higher platform, making the effective use of resources and brand name image in the market.

Cambridge Nanotech Exhibits

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

Transforming criteria of worldwide food.
Improved market share.
Transforming understanding in the direction of healthier items
Improvements in R&D and QA divisions.

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

Use sources.

Competitor Analysis
Business Unilever PLC Kraft Foods Incorporation DANONE
Sales Growth Highest because 4000
Highest possible after Company with much less growth than Company 6th Least expensive
R&D Spending Highest given that 2008 Highest possible after Business 4th Most affordable
Net Profit Margin Highest possible because 2002 with fast development from 2003 to 2019 Because of sale of Alcon in 2013. Practically equal to Kraft Foods Incorporation Practically equal to Unilever N/A
Competitive Advantage Food with Nutrition as well as health and wellness aspect Highest number of brands with sustainable methods Biggest confectionary and also processed foods brand worldwide Biggest milk products and also mineral water brand in the world
Segmentation Middle and upper middle level consumers worldwide Specific customers together with household group Every age as well as Earnings Consumer Groups Center as well as top center level customers worldwide
Number of Brands 2nd 5th 8th 4th

Quantitative Analysis​
Analysis of Financial Statements (In Millions of CHF)
2006 2007 2008 2009 2010
Sales Revenue 73354 623861 442675 874363 481368
Net Profit Margin 9.67% 7.38% 61.52% 9.74% 24.28%
EPS (Earning Per Share) 38.68 9.82 5.34 2.71 53.71
Total Asset 915291 427227 298242 989777 16774
Total Debt 88344 77531 84264 99182 59522
Debt Ratio 78% 67% 37% 96% 63%
R&D Spending 8394 8667 1262 2689 2859
R&D Spending as % of Sales 4.36% 4.42% 4.11% 8.29% 8.37%

Cambridge Nanotech Executive Summary Cambridge Nanotech Swot Analysis Cambridge Nanotech Vrio Analysis Cambridge Nanotech Pestel Analysis
Cambridge Nanotech Porters Analysis Cambridge Nanotech Recommendations