Holmons Company Case Study Essay

At Scharffen Berger Chocolate Maker, Jim Harris was the COO (chief operation officer) and was with the company for about 18 months and was observing the increased demand for their chocolate. “America’s finest dark chocolate” company wanted to increase production by equipping factories with new machineries and equipment but did not want any difference in the taste of the chocolates they produced. As the company totally agrees on not compromising the taste of chocolates and increase the production in order to meet the rising demand for their chocolates they should probably get into customizing chocolates blend for the mass-market retailer in order to grab huge market share, increase accessibility of the chocolate to customers and provide variety of choice to the customers by maintaining the taste they are known for. As the demand is increasing from 50%, 100%, to 150% by the start of 2006, Harris has to make a significant decision in order to invest Scharffen’s capital budget in expansion of the Company. Harris is recommended to acquire the required machinery in order to fasten the production and increase the capacity of the plant and should be careful about the quantity to be produced as the acquiring of machinery will increase productivity multiple times but the initial demand for

Together with the usage of green sources to power the factory, these factors raise up the prices of a chocolate bar to the average of $5. It enhances the brand’s value and good image in people’s observation. Even though their prices are more expensive than other competitors’ prices, Theo still has a loyal following of organic chocolate customers. However, it does a very little traditional advertising. Therefore, in order to maintain the loyal customers and attract new consumers, Theo Chocolate is partnering with local and non-profit organizations that promote their company. Joseph Whinney understands that “Having the ingredients and the quality of the product is the most important thing. And then Fair Trade is the secondary message” (Lindell, par. 19), people concern about the taste, the quality, and the organic food. Besides that, Joe believes that people also care about how a company treats its employees and decide whether they wan to to do business with that company or not. Therefore, combining the two strategies is a good way for Theo to promote itself and build brand value inside customers’ minds.

Since the inception of a revolutionary spicy chocolate recipe, Marilyn Lysohir and Ross Coates have been striving to grow a profitable business in the chocolate industry. Each year Marilyn has loaned the company money to keep it running. Cowgirl Chocolates, primarily run by Marilyn, with help from family and art associates is branded based on the concept that chocolate

Despite a decline in annual growth in the recent past (-1.9%), the chocolate industry alone is still making an estimated $1.8 billion dollar profit. With the help of the estimated $1.3 billion dollars in exports and the improvement in the economic landscape, the industry is expected to grow an annual 3.4% in the years 2011-2015. The total number of companies is expected to fluctuate from the 1,039 that are currently in business (IBIS World, 2011). Considering many candies sell for less than one dollar, a billion dollars in profit is an amazing fete.

The Cherry Lady falls under the premium chocolate industry. Thus, the porter’s model can be utilized by The Cherry Lady as a framework to structure and analyze its industry. According to the Model, the premium chocolate industry can be impacted by five distinct forces such as rivalry among existing firms in the industry, threats from substitutes, bargaining power of buyers, threats of new entrants, and bargaining power of

The overall confectionery market remains robust and of significant size at £3.9 billion and it maintained a 2% growth in value over the past year, driven by price rather than volume. Thorntons’ focus within this is the total boxed chocolate market, which grew 3% over the past year to £748 million. In the UK Commercial channel, Thornton retained their position as one of the top three brands within the boxed chocolate market with an 11.5% market share (2013: 11.9%) and also remained a clear leader in their core inlaid boxed chocolate market, with a 34.5% share (2013: 35.2%). The total gifting market, at £39.4 billion, is more than ten times the size of the confectionery market and similarly grew at 2% over the past year.

Jorge’s dream can definitely be a reality with the use of the proper tools that will differentiate him from his competitors. Jorge needs to position Chocolates El Rey in the proper market by conducting research and analyzing who his exact target market is. He needs to display the key attributes about his chocolates in order to build brand awareness and gain new customers. The chocolate industry is a huge industry which entails a large market to which Venezuela could penetrate. Venezuela has some of the best cocoa in the world, and this is exactly what consumers’ need think of when they hear the name “Chocolates El Rey”.

The product based niche market that I have chosen is the specialty sugar free chocolate market which belongs to the parent food and confectionary industry. Chocolate market is often considered as recession-proof and the revenue from the market has remained resilient despite economic recession, decrease of disposable incomes, volatility in pricing of commodity and increasing competition. Affordability is one of the major factors of the demand in this market segment. For example, during recession times, consumers tend to spend on less costly luxury products like cosmetics and chocolate, even if they had to cut back on other luxuries. Based on the market study by International Cocoa Organization, the US customers consume more chocolate by volume than any other country even though Western Europe is the overall largest market by demand (KPMG, 2012). Although the confectionary industry especially the chocolate market segment have been generally perceived as unhealthy and harmful due to their high sugar and calorie content and the publicized risk between obesity and heart disease. However, the growing demand in the sugar free chocolate niche market segment is driven by the offerings of specialty product line of sugar free cadies which meets the consumer preference of reduced-fat or sugar-free product line. Another key demand driver is the large Hispanic market in US and the growing middle class who is propelling the market with higher demand and also spending more on premium sugar

Thorntons, a more than 100 years old UK brand, is now the largest British chocolate manufacturer and retailer in this country. This chocolate specialist mainly targets at premium chocolate market, retailing mostly through both its own shops and franchise. To diversify Thorntons’ business into Chinese and Indian high-end chocolate market, Foreign Direct Investment (FDI) is recommended for a better control of brand image. Besides, Thorntons is recommended to import UK made highly premium chocolate to retail by its subsidiaries in these two countries.

This structured analysis focuses on the top four retail chocolate manufacturers in terms of global net sales from 2014. The top four chocolate manufactures are Mars Inc., Mondelez International, Ferrero Group and Nestle SA. These manufactures hold approximately 30% of the global retail market share demonstrating their brand power through successful advertising and marketing techniques (appendix 4.1). The global chocolate industry itself has grown by approximately $8 billion USD (net sales) since 2012 despite the growing demand for healthy and organic foods. Organic food sector demands are estimated to grow 14% in the United States through 2018, despite the fact that US chocolate sales have grown 24% in a that time frame (TechSci,2014). The conflicting statistics could only be explained by the successful marketing of retail chocolate companies who have recognized the shifts in market preferences and consumer behavior, and successfully adapted to these trends keeping the appeal of chocolate.

In today markets, there are many other chocolate brand out there that offer low price product and have a variety flavours to attract customers. With this pressure, it can lead to more aggressive marketing price and promotion activity among the competitors and the Cadbury company.

Thorntons is a leading Company of the UK which offers delicious and mouth-watering chocolates to the people. The Company was founded in the year 1911 by Joseph William Thornton. It has been in the chocolate making business for over 100 years. The site of the Company attracts thousands of customers to taste the great quality chocolates which are made of finest cocoa beans and smooth milk. The company works with efficient team members who are always there to assist its customers. The team members’ think of innovative ideas and offers for its customers. The aim of the Company is to bring a huge smile on the face of the people by offering many chocolate products.

Based on the interview with Mr Benjamin Chew, Simply Chocolate Sdn.Bhd being the one of the first specialty handmade chocolate producers in Sabah. As mentioned by Mr Benjamin, Simply Chocolate Sdn Bhd produces approximately 2 tons of handmade chocolate per month and most of which are marketed through those outlets in Kota Kinabalu .As a owner of the company, Mr Benjamin believes in teamwork and innovation as the essential factor to continue success in the market. Therefore, he will conduct weekly meeting with their employees to ensure all the department’s operation going smooth. Also, he will allocate time to work with the production team experimenting with new ideas on their handmade chocolate. Hence, innovation and creativity is one of the way to keep pace with the changing markets and for business to survive. Apart from that, Mr Benjamin also ensure the products are enough to fulfil the demand of the customers by monitor and adjust the stock. As mentioned earlier, 95% of the customers are come from tourists. Therefore, it is very important to ensure the stock are enough to fulfil the demand of

A central aspect of the dynamic problem facing a business in an evolving and competitive industry is the decision about additions to productive capacity. The purpose of this report is to provide strategic advice for the CEO of Bonkers Chocolate Factory (BCF), the U.S division of a multi-national candy company operating in the highly competitive chocolate products market.

What recommendation would you make to Mr. Kiefner? On what basis would you try to persuade him that your proposal is best for Stermon Mills?