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STRATEGIC MANAGEMENT

Case Analysis
Ben & Jerrys Homemade Ice Cream Inc. : A Period
of Transition

Submitted by:-
Akhtar Shahi Qureshi PGP/20/312
Bishal Naskar PGP/20/322
Naman Jaiswal PGP/20/333
Rishi Vyas PGP/20/343
Sonalika Kumari PGP/20/353
Avijeet Tulsiani PGP/20/363
Background:
The corporation of Ben and Jerrys first began in 1978 in Burlington
Started homemade ice-cream shop with an investment of $12000
Gained reputation for the unconventional mix-in flavors Chocolate
Chip Cookie Dough, Cherry Garcia, Rain Forest Crunch, and frozen
yogurt are the major attractions.
Selling its products in all major markets in the US
Established themselves as a top tier competitor in the ice cream
industry from only a few thousand dollars, the business grew to a
million dollar corporation
During the 1990s, they experienced slow growth rates, in 1994, they
lost $1.87 million on sales of $148.8 million
In 1994,Cost of sales increased approximately 9.6 million
Majorly concentrated in super-premium segment 44 flavors brands
Ben & jerrys strong competition by Haagen-Dazs in the super premium
segment
Other significant competitors are Dreyers Grand, Breyers in the
premium segment

Key Strategic Issue:


Loss in sales in 1994
Majorly concentrated in super-premium segment
Consumers were becoming health conscious, price sensitive and value conscious
Increase in competition
Comparatively Lesser advertising expenditures
Increased distribution expenses due to outsourcing

Key Operational Issue:


Ben & jerrys reliance upon Dreyers for production
Difficulties involved in manufacturing ice-cream with large chunks Due to increased
complexity of the business, it had difficulty forecasting demand and maintaining
production efficiencies Shortages of some flavors and overstock of other Strict ingredient
requirements

Action Plan:

SWOT Analysis
Strength Weaknesses

Powerful brand Short life cycle for new product flavors


Using ingredients of highest quality Increased price on Ben & Jerry pints
The company name homemade creates High cost structure due to above average
and nourishes impression in the eyes of the wages and supplier policy
customer Opportunities
Good employee satisfaction lead to low Innovative flavors variety of package
turnover rate and increases learning effects sizes, new low fat ice cream
and employee commitment Promotions-free cone holidays on regular
Less money spend for advertising basis

Opportunities Threats

Innovative flavors variety of package Rises in the cost of dairy products


sizes, new low fat ice cream Dieting habits of a health conscious
generation
Slow economy in US impact on sales
Major competitors such as Haagen Dazs,
Nestle, Pillsbury & Dean foods offer similar
products

Adopt discounting policies


Offer bundled products/smaller packages
Invest more in Smooth product line to increase sales volume
Adopt direct store delivery distribution method
Incentive program for retailers to gain shelf space benefits
Diversify in Premium segment
Limit expansion of Scoop stores does not suit the target customer base
Improve HR policies regarding salary and pay scale

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