Is Ice-Fili’s strategic position have to change ? 1 ? Structure – Ice-Fili evolve in a big market and is success key is the fact that its products were always available for consumers from the creation of the firm. ? Figures – founded in 1937 – more than $25 million in sales in 2002 – largest ice cream market shareholder before Nestle ? Root issue : Increase of substitutes and low switching costs. 2 Moderate SUPPLIERS POWER – Little number in ingredients production – High number in production equipment High Moderate BARRIERS TO ENTRY Economies of scale – Product differentiation – Access to distribution channels INDUSTRY RIVALRY – Concentration – Diversify (Foreign and regional) SUBSTITUTE COMPETITION – Lots of snacks – Low change in prices (costs) – Other goods attraction BUYERS POWER Low switching costs Low elasticity of the demand Lack of differentiation Lots of substitutes High There is a gap between the bargaining power of equipments (high) and ingredients (low) suppliers 3 STRENGHTS High capital available Brand name Lots of products High producing capacityWEAKNESSES OPPORTUNITIES Vertical integration (distribution) Exporting in other URRS markets Create a sinergy with fast food restaurants Distribution Too many different products No specific trademark No additional capital from the products THREATS Substitutes Equipment suppliers Competitors (Nestle and regional producers) Price war to compete Lots of opportunities available to stay at the top of the Russian ice cream market 4 Inbound logistics Use its cold storage and production capabilities Import materialOperations High quality and natural ingredients used to produce many ice creams PROFIT Outbound logistics Distribution to retailers from different distributores Marketing & sales Ice cream carts, TV ads, advertising agency to develop their packaging 5 Develop strategy implications ? Create power brands with few high value products. Improve its distribution channel by vertical integration.
Strengthen relationship with suppliers Invest more in advertising and marketing for its brands. ? ? ? 6