ICE FILLI Harvard Case Solution & Analysis

ICE FILLI CASE SOLUTION

ANSWER TO QUESTION # 1:

PORTER’S FIVE FORCES:

Threats of new entrants:

There are a number of barriers in the entire ice cream industry, which include high establishment costs as well as many gigantic players in the entire industry have already established their footsteps with in the entire industry.Moreover, the customers in the entire industry possess a high degree of brand loyalty. Thus, the overall threat in the entire industry is assessed to be high. (porter, 2008)

Threat of Substitutes:

A number of substitutes are available in the entire market, which include yogurt, chocolates, candies, soda, and beer. In addition to this, the switching cost is also low or minimal. Thus, this increases the overall threat of substitutes and therefore, the overall threat of substitutes is assessed to be high.

Bargaining Power of Suppliers:

The ingredients required for the products are common such as milk, chocolate, sugar, fruit, flavorings, etc. In addition to this, these ingredients are easily available in the market. Thus, this reduces the overall bargaining power of suppliers, and as a result the bargaining power of suppliers is assessed to be low.

Bargaining Power of Customers:

The bargaining power of customers is high due to low switching costs resulting in price competition and low profit margin. In addition to this, all the players in the entire market are selling almost the same product, which provides a number of choices to the customers. Thus, the overall bargaining power of the customers is assessed to be high.

INTENSITY OF RIVALRY:
The entire market is saturated as well as the players in the entire market are making their back breaking efforts in order to attract the customers towards their product. Thus, it is assessed that the overall intensity of rivalry among the competitors is assessed to be high.

BLUE OCEAN STRATEGY:

The company has a diversified product lines to balance the sales of the company as well as the company has resorted to extensive product diversification in order to enhance the overall competitiveness of the company. (Mauborgne, 2015)

ANSWER TO QUESTION # 2:

The company has considered vertical differentiation as its competitive strategy. In addition to this, the company modifies its existing products by new ones in order to strengthen its position in the entire market. Moreover, the company has also entered segment of bulk ice-cream in order to strengthen its position in the entire market. (PANKAJ GHEMAWAT, 2006)
Relative costs have been calculated in the exhibit, which shows that the overall ingredients costs, cost of manufacturing labor and overhead of the company with respect to Nestle is higher due to which the overall manufacturing margin of the company is 13.2% less than the margin of Nestle. Thus, this decreases the overall competency of the company with respect to Nestle(HANNA HAŁABURDA, 2009). In addition to this, the calculations also showed that total manufacturing cost of the company is also 8.2% greater than the industry average. Therefore, the overall manufacturing margin of the company is 8.2% less than the industry average due to which the company is unable to compete strongly in the entire market.................

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