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Ben & Jerry’s Analysis – Appendices B & C. B. Internal: SWs and Value Chain C. External: OTs and Five Forces
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Ben & Jerry’s Analysis – Appendices B & C • B. Internal: SWs and Value Chain • C. External: OTs and Five Forces Note: The following two appendices were developed by a two teams of students from BMA537, Strategic Assessment, Fall 2002 at the Henry W. Bloch School of Business and Public Administration at the University of Missouri at Kansas City. The authors express their thanks to these students whose names are noted below the exhibits that make up these appendices. 604
B. Internal SWOTs and Value Chain - Primary Activities The following analysis was undertaken by MBA Candidates Patrick McGrath, Bernie Troop, and Steve Woods, Fall 2002 as part of the requirements of BMA537 Strategic Assessment. 605
B. Internal SWOTs and Value Chain - Primary Activities - Secondary Activities 606
B. Internal VIRO Word of Mouth Advertising • Valuable • Very loyal customers • Not Easily Imitable • Mass marketing doesn’t generate the same customer loyalty • Rare • Not many companies do it • Opportunity to Exploit • Highlights the company’s down home appeal 607
C. Porter’s 5 - Forces Model* • The Threat of new entrants • Moderate • High margins in super premium • Winning loyal B&J’s customers could be difficult • Development of distribution networks could also be challenging. • Dreyer’s could be a possible threat. • Baskin Robbins could upgrade to super premium with infrastructure currently in place. • Fragmentation of Market – TCBY, Dove Bar, Healthy Choice Analysis undertaken by MBA Candidates John Beadles, Michael Kobe, Justin Koeppen, and Anastasia Palitsyna, Fall 2002 as part of the requirements of BMA537 Strategic Assessment. 609
The Bargaining Power of Buyers • Moderate • Luxury Item – downscale during bad economy • Few sales locations owned by B&J • Due to uniqueness, retailers earn large margin. This reduces their incentive to reduce purchasing costs. • Low switching costs for retailers. 610
Bargaining Power of Suppliers • Low • Ben & Jerry’s is the primary customer of most Dairy Farmers and they rely heavily on them. • Dairy products could probably be used from suppliers outside the state/region with less expense. 611
The threat of substitute products or services • Low to Moderate • There are major competitors like Haagen Daaz, Frusen Gladje and others, but Ben and Jerry’s has a devout customer base developed primarily through word of mouth. • Price of super premium ice cream, lower cost substitutes could be a risk to market share for Ben and Jerry’s. • Comfort Food – could be substituted by others such as Chocolate. • Other Dessert items – Cake, Pie, etc. 612
The intensity of rivalry among competitors • Moderate to High • Competition for freezer space at distributor. • Ben and Jerry’s does have a strong market share, maintaining that share is critical and becomes more of a concern when shelf space comes into play. • Splits 84% of Market almost equally with one competitor (Haagen Daz). 613