Ice Fili Is A Large Scale Domestic Ice Cream Market Essay
2184 Words9 Pages
Although Ice-Fili is a large scale domestic ice cream producer it must compete with other large and small firms in the overall ice cream industry. To breakdown this dynamic I will begin my report with an analysis of the overall ice cream industry in Russia, and will then move on to an analysis on Ice-Fili’s competitive advantages, and strategy. Lastly after analyzing these two areas I will provide my recommendations for Ice-Fili over the next three to five years.
External Environment Analysis (Five Forces)
Threat of New Entrants: High. In the Russian ice cream market we see competitors of ranging sizes competing against one another. 30% of the domestic market is made up of regional small scale producers that have come into the market because it was easy for them to pivot from producing frozen foods to ice cream with very limited capital. Outside of regional producers foreign ice cream companies can enter into the Russian ice cream market whenever they so choose by importing their products to distributors. Foreign companies have been controlled as of late due to instability of the Russian currency against the U.S dollar, but even with this currency risk some foreign competitors have been able to survive by making large capital investments, and producing their product within Russia instead of importing it.
Degree of Rivalry: Medium. The degree of rivalry within the industry is balanced in that a few factors lend to strong rivalry while a similar amount do not. Because
analysis of Ice-Fili, and the paper reveals that Ice-Fili is one of the important ice cream producers in Russia. However, the entrant of foreign ice cream producers such as Nestle has made Ice-Fili to face stiff competitions within the industry. Porter five analysis reveals that Ice-Fili has not been able to compete effectively with foreign companies because the company still relies on imported equipment and technology and traditional method of production, which lead to high cost of production.
Ice-Fili
Russian Ice Cream Market
Although the Russian ice cream market may initially look attractive due to its consistent growth in ice cream production/demand in recent years, after evaluating the market through the five forces framework, it becomes clear that the market far from attractive.
Since the open market economy was first introduced to Russia in 1991, ice cream producer competition has more than tripled in sized to 300 firms by 2002. Significant funding would be required for ice cream manufacturing/distribution
- While analyzing the Ice-Fili case study, I determined that all six parts of the general external environment are applicable. With the economic crisis and the dissolution of the Soviet Union an open market economy emerged. An open-market system meant that the government had little to do with the regulation of the market which created issues because companies just like Ice-Fili could not patent or trademark some of their best-selling ice cream creations. Companies took advantage of this and put their
Christian Vögtlin
A Strategic Case Analysis of Ice-Fili
Seminar paper
Document Nr. V68229 http://www.grin.com/ ISBN 978-3-638-60696-7
9 783638 606967
Universität Konstanz Course: Strategic Management: Concepts and Cases
“Ice-Fili”
A Strategic Case Analysis
Written by: Christian Vögtlin
Table of Contents
1. 2. 2.1 2.2 2.4 3. 3.1 3.2 3.3 4. 5. 6. 7. 8.
Introduction ..............................................................................................................- 1 External Analysis
Strategic Analysis of Ice-Fili
Executive Summary
We at Temple Consulting have completed an analysis of Ice-Fili’s current corporate standing using data collected over the past several years. Using tools such as Porter’s Approach and SWOT we have analyzed the internal and external environments and have recommended several strategic plans of action. Current areas for improvement such as marketing initiatives and re-evaluation of distribution channels will increase sales and profitability almost
Christian Vögtlin
A Strategic Case Analysis of Ice-Fili
Seminar paper
Document Nr. V68229 http://www.grin.com/ ISBN 978-3-638-60696-7
9 783638 606967
Universität Konstanz Course: Strategic Management: Concepts and Cases
“Ice-Fili”
A Strategic Case Analysis
Written by: Christian Vögtlin
Table of Contents
1. 2. 2.1 2.2 2.4 3. 3.1 3.2 3.3 4. 5. 6. 7. 8.
Introduction .......................................................................................................
Ice-‐Fili
Case
Study
Comm
491
–
Momo
Deretic
9:30am
Tuesday/Thursday
M a r t i n
M ,
R y a n
P ,
S o h y u n
P ,
D i e g o
S
Introduction From 1996 to 1998 Ice-Fili suffered from huge increases in costs that gradually ate at their margin at alarming rates. Even worse, from 1999 to 2001 they had a huge decrease in sales and got into liquidity problems. The economic situation for Fili seems to
Ice-Fili case analysis
1. Please provide an in-depth five forces analysis to illustrate the competitive environment for Russia’s ice cream industry. How is it likely to evolve?
Five forces analysis:
1) The bargaining power of suppliers
* As some producers such as Ice-Fili wanted to keep their product’s quality level, they imported specific raw materials, but they didn’t have a problem in finding new suppliers.
* As the technology of Russia was lagged behind Western’s, Ice cream
Ice-Fili (АЙС-θИЛИ)
You cannot defeat a nation that enjoys ice cream at minus 40 Celsius.
— Winston Churchill
To survive in Russia’s ice cream industry during the 11 years since the collapse of the former
Soviet Union was no small feat (see Exhibits 1 and 2). To be successful in these turbulent times was
nothing short of amazing to industry observers. In 2002, Ice-Fili, a midsized Russian company with
more than $25 million in sales, was Russia’s top ice cream producer. Surprisingly, it had