BUSINESS STRATEGY Essay Example | Topics and Well Written Essays - 1250 words

BUSINESS STRATEGY - Essay Example Buyers – the buyer power is high as there are several competitors that have entered the segment. Threat of new entrants – is low because of the high capital involvement in research and development. Substitutes – as people have become health conscious, and have increased knowledge of nutrition, they would not opt for something that is low cost. Competitive rivalry - They are better positioned than the competitors to understand the trends in the world; the only company with big nutrition business and a big food business. This suggests that Nestle enjoys a comfortable position in the industry because of its high bargaining power with the suppliers, and low threats from competitors due to its investment in technology and innovation. The consumers too are less likely to migrate because of lack of availability of substitutes. The industry is attractive as most forces are weak. 3. Value chain Any person, process, product or brand that adds value to a product or service constitutes a value chain (Mascarenhas, Kesavan & Bemacchi, 2004). Adding value is the strategic means to adding value and achieving competitive advantage. The value chain model helps to analyze each individual activity and assess its contribution. In-bound logistics - they produce locally, use less packaging and produce the unit size to local needs. Operations –They use state-of-the-art machines and innovative design for their products and packaging. Roasting and grinding is also based on expert technology; overall sustainable practices. Out-bound logistics – they can reach the products to the consumers quickly in multiple forms. Where necessary they replace the tradition models of delivery through local carts or even use local kiosks for display. They also have distribution... Nestle enjoys a comfortable position in the industry because of its high bargaining power with the suppliers, and low threats from competitors due to its investment in technology and innovation. The consumers too are less likely to migrate because of lack of availability of substitutes. The industry is attractive as most forces are weak. Any person, process, product or brand that adds value to a product or service constitutes a value chain (Mascarenhas, Kesavan & Bemacchi, 2004). Adding value is the strategic means to adding value and achieving competitive advantage. The value chain model helps to analyze each individual activity and assess its contribution. Inbound logistics - they produce locally, use less packaging and produce the unit size to local needs. Operations –They use state-of-the-art machines and innovative design for their products and packaging. Roasting and grinding is also based on expert technology; overall sustainable practices. Outbound logistics – they can reach the products to the consumers quickly in multiple forms. Where necessary they replace the tradition models of delivery through local carts or even use local kiosks for display. They also have distribution channels in department stores or standalone exclusive boutiques. Marketing and sales – they do not go for volumes in sales but value or quality. Service - They offer service 24x7 and delivery takes place within 48 hours. The value chain demonstrates that Nestle attempts to maximize value in each element of the chain – be it in people, product or process.