Ready-to-Eat Breakfast Cereal Industry - 1348 Words

CASE WRITE UP READY-TO-EAT BREAKFAST CEREAL INDUSTRY- GROUP B-5 RTE INDUSTRY BOUNDARIES When looking at supply side of RTE cereal industry major costs to producers constitute of initial investment in production plant. Flexible manufacturing plants resulted in a rather high supply-side substitutability between different cereals. This implies that RTE cereal producers operate in a broader cereal industry as opposed to one for only a specific type, such as puffed or shredded wheat cereals. However, differences exist between supply-side substitutability of well-established branded cereals, such as Kelloggs and private labels. Specifically, as private labels focus on fewer variations of cereals that are simpler and cheaper to produce, it†¦show more content†¦The coupon promotions diminished brand loyalty to the Big Three by encouraging price-sensitive brand-switching. Private labels emerged as an alternative when there were no coupons or promotions. In the early 1990s, some Private labels caught up to the Big Three in terms of technology gaps AND IMPROVED UPON THE QUALITY. Finally, new entrants were successful in leveraging the drawbacks of higher price due to increased cost of manufacturing, promotions, couponing and advertisements, a trait linked with branded companies. IN THE LIGHT OF NEW FINANCIAL RESULTS, EVEN THE RESTRAINT ON INTERNAL PRICE COMPETITION SEEMED TO BE TAKING A BACK SEAT STRATEGIC ALTERNATIVES In 1994 there has been a major strategy shift amongst the Big Three of the RTE industry and other competitors in the industry. General Mills dropped its promotional spending significantly while Phillip Morris and other smaller competitors made sharp rise in spending to take market share from Kellogg and General Mills. There are several competitive game plans that a market leader can initiate to stop this lateral undermining action from competitors. Market leaders have the most to lose through competition and therefore play defensive strategies blocking competitor moves. Game Theory talks about a business likely strategy given theShow MoreRelatedThe Ready-to-Eat Breakfast Cereal Industry in 1994 (A) - Why have private labels been able to enter this industry successfully?1222 Words   |  5 PagesSales of private label cereal grew 50% from 1991-1994 in the Ready-to-Eat breakfast cereal industry. Some of the factors that contributed to the entry of private label cereal manufacturers an d their subsequent growth include - lower costs related to manufacturing, packaging, marketing, RD compared to the Big 3 cereal companies, product quality approaching that of branded products, higher margins for grocers, lower priced products. Some observers blamed higher prices and elaborate expenditure onRead MoreCase Study of Csd Industry, Rte Industry and Specialty Coffee Industry1679 Words   |  7 PagesA Comparison of the Carbonated Soft Drink, Ready-to-Eat Breakfast Cereal and Specialty Coffee Industries Using Porters Five Forces Michael Porter’s framework describes an industry as being influenced by five forces: buyer power, supplier power, threat of substitutes, threat of new entrants and the degree of rivalry between existing firms within the industry. A strategic business manager can use Porter’s model to more clearly understand the industry environment in which its firm operates and toRead MoreThe Breakfast Cereal Industry Has Successful For Decades, Achieving High Returns And Growth1265 Words   |  6 PagesIntroduction Breakfast cereal is one of  the most popular forms  of breakfast in the United States.  Just about all of us have had and enjoyed a bowl of cereal in the morning.  The breakfast cereal industry is very  profitable and has been around a long time.   The NAICS code for this topic is 311320 and the SIC code  is 2043  Cereal Breakfast  Foods, The SIC gives  a description of  establishments as primarily engaged in manufacturing cereal breakfast foods and  related  preparations, except breakfast bars.  Cereal breakfastRead MoreThe Breakfast Cereal Industry Is The Most Popular Forms Of Breakfast Essay1071 Words   |  5 PagesBreakfast cereal is one of  the most popular forms  of breakfast in the United States.  Just about all of us have had and enjoyed a bowl of cereal in the morning.  The breakfast cereal industry is very  profitable and has been around a long time.   The NAICS code for this topic is 311320 and the SIC code  is 2043  Cereal Breakfast  Foods, The SIC gives  a description of  establishments as primarily engaged in manufacturing cereal breakfast foods and  related  preparations, except breakfast bars.  Cereal breakfastRead MoreReady-to-Eat Breakfast1105 Words   |  5 PagesR-T-E Cereal Breakfast Industry Name: Andres Gil Competitive Analysis and Strategy The ready to eat (RTE) cereal industry has grown steadily, with a compounded annual volume rate of three percent between 1950 and 1993. It success during the 20th century had been driven by the surge of consumer’s interest in healthy and dietary food. After World War II there was an increase demand for vitamin fortification products. During the 50’s, pre-sweetening gained popularity among AmericansRead MoreCereal Analysis Paper3539 Words   |  15 PagesDescription One of my favorite things to eat is breakfast cereal. I have been a cereal eater since I was a kid and have chosen to do my paper on the breakfast cereal industry. The NAICS code is 311320. The SIC code is 2043 Cereal Breakfast Foods. The SIC gives a description of establishments as primarily engaged in manufacturing cereal breakfast foods and related preparations, except breakfast bars. Cereal breakfast foods include: coffee substitutes made grain, hulled corn, farina, granola (exceptRead MoreExamining the Corporate Social Responsibility Claims of Kelloggs1715 Words   |  7 PagesIntroduction Breakfast cereals are an integral part of the British diet, and a key sector of the grocery market in the UK. The breakfast cereals market is made up of two main sectors: the ready-to-eat (RTE) sector, the hot cereals sector. It is a market that is well established and has been dominated by three main companies — Kellogg, Weetabix and Cereal Partners (an alliance between Nestlà © and General Mills.) (Keynote, 2011) Together these companies control two thirds of the UK’s cereal intake, whichRead Moreready to eat breakfast industry6266 Words   |  26 Pagesw …†«(01/1ˈÜ ¡Ã¢â‚¬ ¬W) Harvard Business School 9-795-191 Rev. February 14, 1997 The Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 1 All is not well in the land of Tony the Tiger. In early 1994, the ready-to-eat (RTE) breakfast cereal industry had reached a critical turning point in its evolution. In an industry historically characterized by stability and above average profitability, slowing demand growth and a surge in private label sales threatened to undermine the dominantRead MoreKelloggs Microenvironment3051 Words   |  13 Pages. The UK breakfast cereal market is vast accounting for 1.45 billion in 2006. It is divided into hot and cold cereal and the current value growth is 3%. The biggest performer is hot cereal with a 123% value growth between 2002 and 2007. Kellogg’s is the market leader but although it has a lot of power it still has to compete fiercely against many rivals which are looking for a bigger share of the market. The suppliers to Kellogg’s are relatively small independent farms which have very limitedRead MoreBreakfast Cereals in Uk 078038 Words   |  33 PagesBreakfast Cereals in United Kingdom 2007 Introduction: Aim: The aim of this report is to discuss whether The change of macroeconomic situation is an opportunity or threat for United Kingdom’s breakfast cereal industry. Compare the external microenvironment that affects firms in which breakfast cereal industry operates with the help of PEST analysis. To evaluate the operational strategy that affects the level of competitive environment in an industry using Porter’s five force model.