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Chocolate industry case study
Cadbury's business strategies
Chocolate industry case study
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It is little known what kind of rivals there are in the chocolate industry. Is it a rivalry similar to what is present with siblings that is continuous with no clear winner or loser, or one like sports team rivalry’s where there is a winner and a loser? It is safe to say that it is a conjunction of the two, where it is a continuous cycle of winners and losers. With these rivals comes a story of hardships in bringing a start of a business, with breakthroughs soon after, and lastly the rivals accumulated over time. A wonderful example of a now successful industry that had a rocky start is Cadbury. The beginnings of Cadbury chocolate were not an immediate hit, nor was it successful until a rival moved into Cadbury territory. This rivalry gave …show more content…
Cadbury had one of the harder times starting up a business. John Cadbury, started up a chocolate factory (which, at first, primarily sold tea and coffee) in Birmingham, England. At the time of the opening, cocoa beans were used for chocolate drinks, and no particular solid forms were used for eating. In other words, chocolate was not what we think of chocolate today, it was chocolate milk that was on the markets. However, as tempting as any chocolate product sounds, this was not as successful as he originally thought it would be. John decided that his sons George and Richard could aid in the factory, and is inevitably taken over by the two. With a chocolate factory having a bad reputation, and slowly going into horrible debt, the brothers had a mess they needed to recoil into a more sustainable business. In a need of change in quality and quantity of the chocolate, the brothers were able to create three new lines of high quality cocoa. Each giving a slight boost in popularity and business, but not enough to significantly change their life styles or situation the business was in. The big boost the business needed was a motivation, or a …show more content…
In fact, they need a push, a rival. This brings up the rival, the Fry brothers, that particularly challenged the Cadbury company to be better. In other words, it gave them some more motivation to continue their work. A fairly well established business, with fourth generation owners gave room for the Fry’s to take over the chocolate business in Britain. They not only were fairly established in their line of business, they had a revolutionary product. This product was the first chocolate bar, created from a paste, mashed into a solid. The biggest thing that set the Fry brothers way above the Cadbury brothers, besides the previous success, was the monstrous amount of manufacturing facilities that they owned. The Cadburys really had one main facility for the manufacturing of their chocolate while the Fry’s had four main facilities. This made Fry’s chocolate more accessible, and prevalent around Britain. This kind of leader in the chocolate business did not halt Cadburys, but rather gave them the opportunity to surprise them. From cleaver marketing slogans, to breakthroughs, to calculated investment risks, the Cadburys found themselves leveling the playing
While Europe and the United States account for most chocolate consumption, the confection is growing in popularity in Asia and market forecasts are optimistic about the prospects in China and India (Nieburg, 2013, para 9). According to the CNN Freedom Project, the chocolate industry rakes in $83 billion a year, surpassing the Gross Domestic Product of over a hundred nations (“Who consumes the most chocolate,” 2012, para 3). If chocolate continues grow popular in Asia, it stands to become even more lucrative.
“His decision to focus on the production of the Hershey milk chocolate bar is now hailed as one of the most important decisions in the history of American business” (Milton Hershey 1). Certain aspects of Milton Hershey’s life are impossible to not take notice of. A simple chocolate bar completely changed the world of business, Milton S. Hershey impacted the world in a huge way.
Before Milton Hershey had a world wide known chocolate business, he had a small, not so well known caramel business. Milton Hershey began his chocolate making business in 1893, when his father and him traveled to Chicago to attend a big job fair (Tarshis 14), but it wasn’t until 1900 when Hershey succeed in making the first milk chocolate candy bar (The Hershey Company). Hershey attended an exhibit hall of new and amazing inventions around the world at the fair in Chicago. As Hershey walked into the exhibit hall, he was struck by a delectable smell (Tarshis 14). “Hershey was already a leading candy maker. He had created the largest caramel factory in the country, but he became convinced that the future of his business would be chocolate. At the fair in Chicago, Hershey Bought chocolate-making equipment. He had it shipped back to his caramel factory in Pennsylvania. Then he hired two chocolate makers. Soon the company was churning out chocolate candies in more than 100 shapes” (Tarshis 15).
Market research and information about the industry is very important to the organization because it will allow the organization to position itself well in terms of sourcing chocolate raw materials and in identifying the market for its products. For example, understanding that some chocolate product purchases are seasonal, e.g., at Christmas; around Mother’s Day; and, on Valentine’s Day, allows the organization to have more product on hand and to create displays, in store, that will increase purchases and attract more customers when existing customers tell their friends about the availability of high end products, at reasonable prices, in their store.
Coe, Sophie D., and Michael D. Coe. The True History of Chocolate. 2nd ed. New York: Thames and Hudson, 2007. Print.
Chocolate companies changed from minimal production to massive manufacturing. Thus, targeting different market segments that weren’t possible to reach due to the high cost of the good. The market was able to shift because of the industrialization process that includes several innovations, such as van Houten’s process, this allowed a broad production and distribution of chocolate that spread around the globe.
Charles Chocolate’s sales revenue decreased -1.176% between the years 2010 and 2011. The equation that as used to get that was Revenue Growth= 100 × (Current Value-Prior Value/Prior Value) 100 × (11,850,480-11,991,558/11,991,558). The change in the sales revenue could have happened for very many reasons. Being a premium chocolate making company, their product may not have been very high in demand. Also forecasting the demand for their product was not a very easy thing to do either. Another issue that Charles Chocolate’s faced their competitors, such as Godiva and Lindt, are more of a well known brand then they are.
The Hershey Food Corporation is a very successful and quality business. Many products are manufactured by this corporation. Most relating, but not limited to chocolate. The corporation plays a role in deciding where products are produced. Hershey’s has expanded to both Canada and Mexico, which calls for many corporate decisions. There are an amazing amount of products associated with Hershey. These include Jolly Ranchers, Hershey Kisses, Hershey drink mixes, the entire line of Reese’s products as well as good old fashion chocolate bars. These products serve in the candy/snack foods division of sales. Society could do without them... but why would we want to?
He was a man full of integrity, sincerity, and character; who changed the lives of many by providing them homes, jobs, and of course the satisfaction from eating a scrumptious creamy milk chocolate bar (Erdman). He is well-known for not only “The Hershey Chocolate Company”, but his own “town of Hershey” (“Milton Hershey” 144). As a philanthropist, entrepreneur, and giver; Milton Hershey created his own American Dream through many failures and perseverance.
During a "chocolate scare" in the early 1970's when the supply of chocolate went way down and the price went way up Hershey's who uses chocolate as a main ingredient more than Mars does had to cut down on spending in some area of business, so they chose to cut down spending on advertising. Mars saw this as an opportunity to spend more money on advertising and even more importantly M&M/Mars saw an opportunity to knock Hershey's out of the #1 spot. M&M's plan was successful, they used very aggressive marketing and they become the #1 chocolate/candy company in America.
The aim of this report is to present and critically estimate the market strategies of an international and a local chocolate manufacturer in Austria. The analysis is carried out in three stages – macro-environment (PEST analysis), micro-environment (Porter’s Five Forces Model) and company comparison (SWOT analysis). In the end, recommendations are given for the local brand Wiener Schokolade König.
Alan’s Best Chocolates (ABC) is a leading company in the sales of confections and chocolates throughout the United States. The company’s products are sold from 50 stores across the country and maintain a high reputation for superior quality and taste. While the company’s sales have grown over the past ten years, the rate of growth has significantly slowed. One key factor for this slowing rate of growth is the shift in the marketplace to purchasing chocolates and confections online. For a company to succeed, it needs to plan on how to capitalize on this online marketplace by leveraging existing technologies, industry best practices, and aggressive marketing and sales campaign to ramp up the its growth projections for the foreseeable
Introduction The 58 million pounds of chocolate eaten on chocolate the drenched holiday of Valentines Day is likely made from cocoa beans from West Africa. The Ivory Coast, also known as Cote D'ivoire in Africa is the source of about 35 percent of the world’s cocoa production. These cocoa beans were likely harvested by unpaid child workers that are being held captive on plantations as slaves. Chocolate companies use these cocoa plantations as their cocoa source for their chocolate products. And since the companies want to maximize their profit, they push plantation owners to lower prices, causing plantations to cut price any way possible (Philpott).
In order to understand the situation of Cadbury-Schweppes in the CSD industry, the product, which is soda, needs to be analyzed.
However, after large amounts of pressure from environmentalists, households and then businesses refusing to stock Cadburys chocolate, Cadburys finally conceded and moved back to the old recipe. The marketing director Matthew Oldham said, ‘At the time, we genuinely believed we were making the right decision, for the right reasons. But we got it wrong. Now we 're putting things right as soon as we possibly can, and hope Kiwis will forgive us’ (CHECK WHEN HE SAID THIS)