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KEY MANAGEMENT ISSUES
Shimla Dairy is not among the current leading players in the market. The market leader's (Britannia) production capacity per day is almost 50 times that of Simla Dairy. With nearly 29 varieties of products, Shimla is now trying to increase the product line further. The company currently has 2 plants one at Shimla and the other at Kiarighat with a total capacity of 10000 litres of milk processing. With the Cheese industry slanting towards the growth phase, there is expected to be high increase in the competition, both from the domestic and the foreign players. This gives rise to number issues which concern the management. Which are as stated below:
Currently, the company lacks of focus as it has a diverse product line with too many varieties of cheese products. With so many products it cannot be sure to decide as to which market segment to target in order to take the advantage of the growing market.
The current Production Capacity is Low to face the upcoming competition-The dairy currently produces 10000 liters of milk per day even after 30 years of presence in the market. This will certainly affect the chances to take advantage of the current growing market and to manage the consumption cycles of the industry. The question of whether to decide on the expansion of production capacity: With an incredible growth expected in the industry, the issue that the management faces now is, whether to increase the production capacity or not. This is very much needed as the expansion of production capacity will equip the company to supply and cater to the demand as well as attain economies of scale, which can be used as a competitive advantage against the new entrants. However, this calls for capital investments on the assets required for expansion.
Another key issue here is to decide which market segments to target and enter into as Shimla Diary should now needs to focus its efforts on certain market segments and cater to their needs based on the level of profitability and attractiveness that segment offers.
Another issue which needs to be addressed is to Build the Brand Equity of the company: The company is very small and not figure among the top players in the industry. It had never invested on any marketing expenditure to promote itself and just relied on word of mouth. The company had published some flyers and a brochure recently and also started providing refrigerators with the name Shimla Dairy highlighted to stores which most of the big players were practicing it ever since.
Nevertheless, it must “defend” its current market share if not increase it, by maintaining premium quality and develop innovative products. The marketing mix strategies will effectively achieve targeted revenue and profitability in the near future.
Ice-Fili is a traditional Russian manufactured who has been the market leader in the Russian ice-cream industry but over the years the supremacy and competitive edge has been declining. Due to its traditional competency it has a lot of capacity, much of which is lying unutilized. Out of its capacity of 200 tons/day, it is utilizing only about 25% (with an annual production 16000 tons, assuming 300 working days).
... The routine conversation that is usually conducted when we gather together is concerning the inflated price of milk of which has transpired within the last ten years. With possessing a small child the need for the consumption of milk is not considered an optional luxury but a necessary commodity for small children and their overall development. With inflated prices on necessary commodities, such as milk, for many young families produces an enormous financial burden with monthly demands of milk. Dealing with this issue of inflation is an extremely difficult issue to bring a conclusive solution towards however, the article makes a good point in sharing that there is a vital need to reexamine the present system.
The Specialty Cheese Company is a dynamic, small company that has thought about its future. The company has been around since 1839. It has survived when there were over 4000 cheese companies, The Great Depression and over 150 years of leadership. With less than 150 cheese companies in the United States, the Specialty Cheese Company has three United States Department of Agriculture approved functioning companies.
Finally, I have suggested some recommendations for the issues that I have mentioned above. In reference to the first issue, it will be profitable for the company to change to level monthly production.
Caroline and Jennifer said that ‘Market segmentation is a crucial marketing strategy. Its aim is to identify and delineate market segments or set of buyers which would then become targets for the company’s marketing plans.’ (Tynan and Drayton, 1987) There are many ways to segment the market, such as age, region, environment, psychology and wages (Hall, Jones and Raffo, 2010).
Food industry can be chartered by low margin industry, while along with the shift of power from the manufacturer to the purchaser, the price and demand became flexible, and the product variety increased.
This will not only maximize the company’s operational expenses by concentrating only to a particular segment of the age bracket of consumers by providing them product lines that will suite their taste and demands it will also allow the company to set the trend as to what is the next big exciting thing this season. In this case, the company’s resources will be used properly and is expected to increase its market share continuously leaving the competitors far behind. (Starbucks,
Once a business has successfully completed segmentation based on the market into various groups the targets will be chosen. As we all know no one unique strategy will be able to appeal to all consumer segments therefore being able to come up with different strategies for specific targets are a vital aspect of marketing.
ice cream belonging to the premium category. Based on our analysis, we have identified two major
After looking at trends in the market and seeing that consumers are becoming more health conscious and the need for food that is easy to prepare it was decide that this product would do well in a consumer market made up of mid and upper mid income families and individuals.
...he market and lack of an all-round business plan covering all aspects. For the company’s discussed it will be very easy to achieve the goals and be one of the successful company’s in the country and global wise.
Fonterra will always prioritizes New Zealand milk so they need to maintain the active and dynamic business going. To be more efficient, there have been projects mobilizing out to make improvements to the company’s assets in New Land i.e. supply chain and manufacturing plants.
With the rise of the economy, consumers have become more and more knowledgeable on selecting their favourable product as a result the organization cannot focus on what it sells but on the side focus on what the customer wants to buy.
There are many elements affecting to the success of a launching. The basic factor is to develop product that satisfies consumers’ demands and maintain the brand promise. However, consumers are not only looking for the quality of product but also concerning about the price, the promotion and so on.