Analysis they do offer a slightly different

Analysis they do offer a slightly different

Analysis of Cold Stone Creamery using Porter’s model Cold Stone Creamery has been a very popular ice cream spot since 1988. Locations have have popped up all over the globe since then. Many enjoy their premium ice cream as well as the ability to customize it with countless ingredients to make their own personal creation, or simply chose from one of the suggested creations. Although the company has been successful in the past, it still faces many threats. There are many competitors in the ice cream world that Colds Stone has to go up against. Some of their direct competitors include Marble Slab and Maggie Moos.These ice cream stores have very similar business models by offering many ice cream flavors and mix-ins allowing customers to customize their ice cream.

Other competitors include Carvel, Baskin Robbins, and Ben and Jerry’s. Although these companies are also very successful, they do offer a slightly different type of product. The threat of new Entrants into this type of market appears to be moderate. There are many successful, existing creameries, which might pose a challenge for new entrants.

We Will Write a Custom Essay Specifically
For You For Only $13.90/page!

order now

Another challenge for new entrants could be the current economic situation.People currently do not have a lot of disposable income to spend on luxuries such as going out for dessert. But economy, and existence of other companies aside, A new entrant to the market could pose a threat to Cold Stone. Customers of Cold Stone do not have any ties that would make them have to return to one of their stores for additional parts or services of the product that they receive, because once it is consumed, that’s it. This would make it very easy for consumers to go to a brand new store the next time they want ice cream. Another factor that might make other new entrants look appealing is cost.

Although people may like Cold Stones products very much, they are very expensive. The base of all of their ice creams use premium ingredients and the additional cost of every mix-in can add up quickly. If a new entrant could provide a very similar product at a lower cost, it could pose a large threat. Although Cold Stone may seem unique in some ways, there are still many substitutes that are available for buyers. Due to the fact that Cold Stone has particularly high prices, many consumers would be willing to substitute their ice cream with others that are less expensive such as Baskin Robbins or Carvel.If consumers wanted to go one step further with saving money they could even just go to a grocery store and scoop it at home for a significantly lower price.

Although the ice cream that consumers can buy elsewhere might not be at the technical level of the premium ice cream sold at Cold Stone, many might not perceive this as being worth the price ticket that is put on their ice cream, and find it not very hard to switch to a different brand for a lower cost. Another substitution that Cold Stone might find as a threat, as well as other creameries, is frozen yogurt.The frozen yogurt industry has significantly increased over the past few years.

People have become more health conscious and have found a healthier substitution for high calorie, high fat ice cream. Cold Stone has recently made it more desirable for people to come in by reducing their buyer power. They offer a rewards program through a card where there are perks such as: a buy one get one creation on your birthday, emails with member’s only coupons, new products and promotions, as well as the opportunity to win prizes throughout the year.This reward program keeps customers coming in by providing motivation through offers and reminders. The suppliers have a lot of power in the Cold Stone franchise. It is very expensive to buy into the company to start your own franchise and many of the products are bought directly from Kahala Franchising, the owner of Cold Stone. The materials such as the ice cream bases and equipment that are used to make the ice cream fresh, in house are purchased from Kahala Franchising, and they make a profit off of their franchisees, which can get very expensive.

The other materials needed can be purchased from other food distributors such as SYSCO. The labor for a Cold Stone, however is not overly demanding. One or two employees can open and make the ice cream needed for the day, and there only needs to be a few employees on during the shift to serve the ice cream. Cold Stone’s cost strategy appeals to those who are willing to pay a little more for their particular premium product.Even though the cost is high, they manage to keep a broad market scope because although they are near the height of prices for ice cream, it is still not that expensive in the grand scheme of products. Cold Stone also appeals to a broad market because they offer a unique product, and people are willing to pay for an ice cream that they can customize to their liking.

Cold Stone has remained a successful company in that they have thrived in all of the market situations, by providing a premium product, charging a premium price for it, and still remaining popular and competitive.

No Comments

Add your comment


I'm Alfred!

We can help in obtaining an essay which suits your individual requirements. What do you think?

Check it out