Simple Regression Mathematics Case Study Analysis

Case Study Solution And Analysis

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Simple Regression Mathematics Case Study Solution

Simple Regression Mathematics is currently one of the greatest food cycle worldwide. It was founded by Kelloggs in 1866, a German Pharmacist who first introduced "FarineLactee"; a combination of flour and milk to feed infants and decrease death rate. At the very same time, the Page siblings from Switzerland likewise found The Anglo-Swiss Condensed Milk Business. The 2 ended up being competitors initially but in the future combined in 1905, resulting in the birth of Simple Regression Mathematics.
Business is now a multinational business. Unlike other multinational business, it has senior executives from various countries and tries to make choices thinking about the whole world. Simple Regression Mathematics presently has more than 500 factories worldwide and a network spread across 86 countries.


The purpose of Simple Regression Mathematics Corporation is to boost the lifestyle of individuals by playing its part and supplying healthy food. It wishes to help the world in forming a healthy and better future for it. It likewise wishes to motivate people to live a healthy life. While making certain that the business is succeeding in the long run, that's how it plays its part for a better and healthy future


Simple Regression Mathematics's vision is to offer its customers with food that is healthy, high in quality and safe to eat. Business visualizes to develop a trained workforce which would help the company to grow


Simple Regression Mathematics's objective is that as currently, it is the leading business in the food market, it believes in 'Great Food, Great Life". Its objective is to provide its customers with a range of options that are healthy and finest in taste as well. It is concentrated on offering the best food to its clients throughout the day and night.


Business has a wide range of items that it offers to its clients. Its products include food for infants, cereals, dairy products, snacks, chocolates, food for family pet and mineral water. It has around four hundred and fifty (450) factories all over the world and around 328,000 staff members. In 2011, Business was listed as the most gainful organization.

Goals and Objectives

• Keeping in mind the vision and objective of the corporation, the company has laid down its objectives and goals. These goals and goals are listed below.
• One objective of the company is to reach no garbage dump status. (Business, aboutus, 2017).
• Another objective of Simple Regression Mathematics is to waste minimum food throughout production. Frequently, the food produced is lost even prior to it reaches the consumers.
• Another thing that Business is working on is to improve its product packaging in such a method that it would help it to lower those issues and would also ensure the delivery of high quality of its products to its clients.
• Meet worldwide requirements of the environment.
• Develop a relationship based on trust with its customers, organisation partners, staff members, and federal government.

Critical Issues

Recently, Business Company is focusing more towards the strategy of NHW and investing more of its revenues on the R&D innovation. The nation is investing more on acquisitions and mergers to support its NHW technique. The target of the business is not achieved as the sales were anticipated to grow greater at the rate of 10% per year and the operating margins to increase by 20%, offered in Exhibition H.

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The current Business strategy is based on the idea of Nutritious, Health and Health (NHW). This strategy deals with the concept to bringing modification in the customer preferences about food and making the food stuff much healthier concerning about the health concerns.
The vision of this technique is based upon the key technique i.e. 60/40+ which simply indicates that the items will have a score of 60% on the basis of taste and 40% is based upon its dietary worth. The products will be made with additional 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 delicious plus healthy foods and drinks in market than ever. In competition with other business, with an intention of keeping its trust over clients as Business Business has gotten more trusted by clients.

Quantitative Analysis.

R&D Spending as a percentage of sales are decreasing with increasing actual amount of costs shows that the sales are increasing at a higher rate than its R&D costs, and permit the company 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 thumbs-up to the R&D costs, mergers and acquisitions.
Debt ratio of the business is increasing due to its spending on mergers, acquisitions and R&D advancement rather than payment of financial obligations. This increasing financial obligation ratio pose a threat of default of Business to its financiers and could lead a declining share rates. In terms of increasing financial obligation ratio, the company ought to not invest much on R&D and should pay its present financial obligations to reduce the danger for financiers.
The increasing risk of financiers with increasing financial obligation ratio and declining share rates can be observed by huge decrease of EPS of Simple Regression Mathematics stocks.
The sales development of company is also low as compare to its mergers and acquisitions due to slow understanding structure of customers. This sluggish development also prevent business to further spend on its mergers and acquisitions.( Business, Business Financial Reports, 2006-2010).
Note: All the above analysis is done on the basis of calculations and Graphs given in the Exhibits D and E.

TWOS Analysis

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

Strategies to exploit Opportunities using Strengths

Business needs to present more ingenious items by big 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 could also supply Business a long term competitive advantage over its rivals.
The global growth of Business ought to be focused on market recording of developing countries by growth, bring in more consumers through consumer's commitment. As developing countries are more populous than developed nations, it might increase the consumer circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Swot AnalysisSimple Regression Mathematics ought to do mindful acquisition and merger of organizations, as it might affect the customer's and society's understandings about Business. It must obtain and merge with those business which have a market reputation of healthy and nutritious business. It would enhance the perceptions of consumers about Business.
Business must not just spend its R&D on innovation, instead of it must also focus on the R&D costs over examination of expense of numerous healthy products. This would increase cost performance of its items, which will lead to increasing its sales, due to declining rates, and margins.

Strategies to use strengths to overcome threats

Business must move to not just developing but likewise to developed nations. It ought to expand its circle to different countries like Unilever which runs in about 170 plus countries.

Strategies to overcome weaknesses to avoid threats

It must obtain and merge with those countries having a goodwill of being a healthy business in the market. It would also make it possible for the business to utilize its possible resources efficiently on its other operations rather than acquisitions of those organizations slowing the NHW strategy growth.

Segmentation Analysis

Demographic Segmentation

The group division of Business is based upon four aspects; age, gender, income and occupation. For example, Business produces numerous products associated with babies i.e. Cerelac, Nido, and so on and related to grownups i.e. confectionary products. Simple Regression Mathematics products are rather affordable by practically all levels, but its major targeted customers, in terms of earnings level are middle and upper middle level customers.

Geographical Segmentation

Geographical segmentation of Business is composed of its presence in practically 86 nations. Its geographical division is based upon 2 main factors i.e. average earnings level of the customer along with the environment of the region. Singapore Business Business's division is done on the basis of the weather condition of the area i.e. hot, warm or cold.

Psychographic Segmentation

Psychographic segmentation of Business is based upon the personality and life style of the customer. Business 3 in 1 Coffee target those customers whose life design is quite busy and don't have much time.

Behavioral Segmentation

Simple Regression Mathematics behavioral division is based upon the mindset understanding and awareness of the client. Its highly healthy products target those clients who have a health mindful mindset towards their consumptions.

Simple Regression Mathematics Alternatives

In order to sustain the brand name in the market and keep the customer undamaged with the brand, there are two alternatives:
Option: 1
The Business should spend more on acquisitions than on the R&D.
1. Acquisitions would increase overall possessions of the company, increasing the wealth of the business. Spending on R&D would be sunk cost.
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 revived, and it will be thought about completely sunk cost, if it do not give prospective outcomes.
3. Investing in R&D provide sluggish development in sales, as it takes long time to present a product. Acquisitions supply quick outcomes, as it provide the company already developed product, which can be marketed quickly after the acquisition.
1. Acquisition of business's which do not fit with the business's values like Kraftz foods can lead the company to face mistaken belief of consumers about Business core worths of healthy and healthy products.
2 Large spending on acquisitions than R&D would send out a signal of company's inadequacy of developing innovative items, and would outcomes in consumer's dissatisfaction.
3. Large acquisitions than R&D would extend the product line of the company by the products which are already present in the market, making company not able to present brand-new ingenious items.
Option: 2.
The Company ought to spend more on its R&D instead of acquisitions.
1. It would allow the company to produce more innovative 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 customers by introducing those products which can be used to a completely new market segment.
4. Ingenious products will offer long term benefits and high market share in long run.
1. It would decrease the earnings margins of the company.
2. In case of failure, the entire costs on R&D would be considered 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 company, which might supply a negative signal to the investors, and might result I decreasing stock rates.
Alternative 3:
Continue its acquisitions and mergers with substantial spending on in R&D Program.
Vrio AnalysisPros:
1. It would enable the business to present new innovative items with less threat of transforming the spending on R&D into sunk expense.
2. It would supply a positive signal to the investors, as the overall properties of the company would increase with its substantial R&D spending.
3. It would not affect the profit margins of the company at a large rate as compare to alternative 2.
4. It would provide the company a strong long term market position in regards to the business's general wealth along with in regards to innovative items.
1. Threat of conversion of R&D spending into sunk expense, higher than alternative 1 lower than alternative 2.
2. Danger of misunderstanding about the acquisitions, greater than alternative 2 and lower than option 1.
3. Introduction of less number of ingenious items than alternative 2 and high variety of ingenious items than alternative 1.

Simple Regression Mathematics Conclusion

RecommendationsIt has institutionalised its strategies and culture to align itself with the market changes and customer behavior, which has eventually allowed it to sustain its market share. Business has developed significant market share and brand identity in the urban markets, it is advised that the business should focus on the rural locations in terms of developing brand name commitment, awareness, and equity, such can be done by producing a particular brand allowance technique through trade marketing tactics, that draw clear distinction in between Simple Regression Mathematics products and other competitor products.

Simple Regression Mathematics Exhibits

PESTEL Analysis
Governmental assistance

Changing criteria of global food.
Enhanced market share. Changing understanding towards much healthier products Improvements in R&D as well as QA departments.

Intro of E-marketing.
No such influence as it is good. Worries over recycling.

Use resources.

Competitor Analysis
Business Unilever PLC Kraft Foods Incorporation DANONE
Sales Growth Highest considering that 1000 Highest after Business with less growth than Organisation 1st Least expensive
R&D Spending Highest given that 2003 Highest possible after Company 6th Least expensive
Net Profit Margin Highest possible considering that 2006 with fast growth from 2003 to 2015 Because of sale of Alcon in 2011. Practically equal to Kraft Foods Unification Nearly equal to Unilever N/A
Competitive Advantage Food with Nutrition and also health factor Highest possible variety of brand names with lasting methods Biggest confectionary and also refined foods brand in the world Biggest dairy products as well as mineral water brand worldwide
Segmentation Center and also upper center level customers worldwide Specific consumers in addition to house team All age and also Earnings Client Teams Center as well as upper center level customers worldwide
Number of Brands 4th 7th 2nd 1st

Quantitative Analysis​
Analysis of Financial Statements (In Millions of CHF)
2006 2007 2008 2009 2010
Sales Revenue 24441 564592 445929 678341 755199
Net Profit Margin 8.71% 3.67% 72.71% 4.24% 19.12%
EPS (Earning Per Share) 35.86 1.92 4.48 4.68 11.71
Total Asset 723298 821456 592747 282678 71442
Total Debt 78475 52564 92889 29859 82359
Debt Ratio 35% 89% 72% 84% 17%
R&D Spending 8322 3225 5999 1536 5433
R&D Spending as % of Sales 7.61% 5.81% 8.48% 7.35% 6.72%

Executive Summary Swot Analysis Vrio Analysis Pestel Analysis
Porters Analysis Recommendations