Strategic analysis forms an integral part of the business processes. This analysis helps in systematizing the activities according to the priorities. Involving the stakeholders and shareholders in strategic analysis, helps in undertaking effective decisions, for the betterment of the companies and organizations. This report looks into the strategic management of BEGA Cheese LTD.
Bega Cheese Ltd is an Australian dairy company, situated in Bega, New South Wales. The company attained the status of public company in 2011. In the same year, the company was enlisted as ASX, coded as BGA. As a matter of specification, the company has achieved accolades and glory through the provision of quality cheese, spreads, grocery items, bio nutrient products. According to the annual reports of 2016, the annual revenue of the company was recorded as A$ 1,195,967,000 (Begacheese.com.au 2018).The operating income was recorded as A$ 66,009,000. The net income was A$ 29,202,000. The market capital for the company is 1.475 billion.
The company operates under dairy and food processing industry. Australian Food Sector possesses high value in the domestic economy. This is through the means of encompassing several supply chains. Food and beverage manufacturing industry is the largest among Australia. In terms of international trade, Australia is traditionally known for exporter of the food products. This has enhanced the quality and standards of the food products. Meat, wine, beer, malt, spirits and dairy products are the major contributors toward stabilizing the Australian economy (Agriculture.gov.au 2018). The value for the processed food products exports declined to $ 16.8 billion in 2009-2010, which is $1.7 billion lower than the era of 2007-08. Rise in Australia’s trade terms resulted in income growth. Most importantly, it lifted the purchasing power of the industry.
Higher input costs affected the production of some of the food products. This lowered the costs, aggravating the complexities in terms of indulging in alliance with the overseas suppliers at low cost. Innovation in the manufacturing techniques attracted large number of buyers. This revolutionized the business of the industry, providing it with the scope of enjoying competitive advantage over the contemporary industries. Typical example of this is the food processors, which seem effective in manufacturing foods in less time (Agriculture.gov.au 2018). This is in terms of the changing needs, demands and requirements of the customers. Mention can be made of the low fat cheese in terms of catering to the health issues of the old age customers.
Concentration of two or three key players helps in maintaining the consistency in the industry.
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Political |
· Political instability · Risk of military invasion · Trade tariffs on the food and beverage items |
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Economic |
· Governmental intervention on the import and export of the food items · High exchange rates · Inflation · High prices of the raw materials |
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Social |
· Changing lifestyle of the population |
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Technological |
· Innovation in transport for preserving the quality of cheese · Cost structure · Value chain structure |
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Legal |
· Food Safety Act
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Environmental |
· Climate change · Waste management |
Table 1: PESTLE analysis of BEGA Cheese Ltd
(Source: Begacheese.com.au 2018)
Political
Political instabilities act as obstacle in the import and export of the produced cheese. Governmental intervention in the form of tax tariffs aggravates the complexities of BEGA Cheese Ltd in terms of exporting the cheese to the neighbouring countries. Military invasion is a huge loss for the property and livestock, which stalls the production of efficient and effective quality cheese.
Economical
High exchange rates of the food items make the process of price setting difficult in case of the manufactured cheese. Along with this, inflation and high prices of the raw materials like milk and curd, is problematic in terms of preparing efficient quality cheese (Agriculture.gov.au 2018). Strategic alliance with the members of the trade union assists the company personnel in terms of influencing the purchasing power of the buyers.
Social
In today’s fast paced life, people need instant energy in the readymade foods. This is in terms of lack of adequate time for eating healthy and nutritious foods. Absence of sufficient time compels the people to gorge on fast foods, which affect their health. Rise in demand of the healthy foods have compelled BEGA Cheese Ltd to manufacture fat free cheese.
Technological
Due to the demands of supplying the cheese to the close proximity of the customers, the transportation facilities need to be such, which adds to the preservation of the quality and freshness of the cheese. Innovations in the temperature regulators of the fridges are beneficial in terms of maintaining the quality and freshness of cheese until they are sold to the customers (Desai, Kotadiya, Makwanaand Patel 2015). Herein lays the effectiveness of considering the rates of technological diffusions in termsof maintaining the balance between the supply and demand.
Legal
The processed cheese undergoes quality tests, after which they are issued certificates. This certification authenticates the cheese in terms of its safe consumption. The company enters into alliance with the statutory bodies for conducting the lab tests. An important legislation here is Consumer Protection Act, which helps in ensuring the safety of the consumers after consuming the processed cheese.
Environmental
Sudden climatic changes add to the complexities in terms of setting the cheese. For this, safe and quality cold storage places are selected for preparing and storing the cheese. Well ventilated places are needed in terms of preparing the cheese as per the requirements. One of the other aspects here is the waste management. BEGA Cheese Ltd needs to be credited for using solid waste management techniques (Munir et al. 2015). The plastics used for packing the cheese are segregated. This is in terms of detecting the plastics, which can be recycled. This approach is praiseworthy in terms of mitigating the environmental pollution and preserving the ecological diversity.
Threat of new entrants
The private companies, intending to set up their business in the Australian market can act as a threat for the BEGA Cheese LTD. This is in terms of luring the maintaining the market position. Fixing the cost per unit of the economic scale, acts assistance for the company, in terms of securing the market position.
Bargaining power of suppliers
The suppliers ruling the market can be controlled through the supply of quality resources. Therefore, indulging in contracts would assist the company personnel in controlling the suppliers. This would enhance the scope and arena of the supply chain network (Augustin et al. 2016).
Bargaining power of the buyers
Manufacturing quality cheese is one of the means, through which BEGA Cheese LTD lures the buyers. Online transactions help the personnel in influencing the buying power of the buyers. More powerful communication channels strengthen the customer base.
Threat of substitutes
The small and private enterprises intends to take control of the Australian market. However, the strategy is not adequate in terms of increasing the market share. Haphazard means for selling poor quality cheese in the same name acts as a threat of substitute for BEGA cheese LTD.
Competitive rivalry
BEGA Cheese LTD indulges in competition with brands like Bellamy’s Organic, a2 Milk Company among others. The competitive rivalry is higher, as the brands intend to prepare high quality cheese for the customers (Begacheese.com.au 2018). However, BEGA Cheese LTD uses fat free milk, which caters to the health issues of the customers. This is one of the factors, which outstands the brand from the others.
BEGA Cheese LTD is subsidiary of Peanut Company of Australia. This company is one of the leading suppliers of peanuts. According to one of the announcement, BEGA Cheese possesses 19.99% shares of Peanut Company. The placement shares would account for $1.9 million. Issuing placement shares would result in $10 million takeover in case of by BEGA Cheese LTD in terms of acquiring all the shares, which are not acquired by the company. The strategies of the Peanut Company include processing value chain from the new peanut crops, which undergo various processes ranging from drying, shelling, and blanching to the finished product (Pca.com.au 2018). Absence of lab tests for the produced crops acts as an obstacle in the achievement of customer satisfaction.
Development of exciting cultivars is an opportunity in terms of yielding high quality crops. This production bears high value in the market, which increases the sale revenue and profit margin. This reflects the alliance between the suppliers, enabling the staffs to widen the scope and arena of the business. Social media marketing is assistance in terms of enhancing the trafficking of the audience towards the brand image. Uploading the specifications of the crops on the official website and the social networking sites informs the customers regarding the latest trend adopted in terms of fulfilling the identified and specified requirements (Pca.com.au 2018). Negligence towards installing privacy cookies and policies in the profile of the customers can act as a threat in terms of catering to the needs, demands and requirements of the customers.
Dairy industry of Australia possesses 42000 skilled and efficient employees, which helps in the production of 9 billion litres of milk every day. The company makes use of latest and modern technologies for producing cheese and the spreads. Typical example of this is the food processors, which helps in manufacturing the cheese in an efficient and effective manner. BEGA Cheese LTD needs to be credited for making use of effective quality storage techniques for preserving the manufactured cheese (Begacheese.com.au 2018). The processors are the example of tangible resources, which results in the production of quality cheese. Patents and copyrights are the intangible resources, which enhances the standards and quality of the manufactured cheese. Trademarks, an intangible resource, enhance the brand image as well as brand awareness.
The company possesses the capability of providing access to the students in terms of enhancing their knowledge regarding the latest trends of the dairy and food processing industry of Australia. This reflects the capability of providing online assignment help to the foreign students. Along with this, BEGA Cheese LTD also possesses the capability of providing access to the farmers regarding the harvesting techniques (Begacheese.com.au 2018). All of these capabilities undergo competency mapping in terms of assessing the skills, knowledge and awareness of the students and farmers. Here, probability methods are used for selecting the students for the courses. In case of the farmers, their awareness towards harvesting techniques are tested.
The company is competent enough for supporting the community people in terms of their basic needs. This is done from the BEGA Cheese Heritage Centre. This centre is one of the means for preserving the cultural heritage. The human resource management of the company is competent enough for living upto the standards of foods. Taking the assistance of the professionals for quality tests enhances the competencies, skills and abilities towards achieving large scale customer satisfaction (Begacheese.com.au 2018). Foreign examiners are hired for taking interviews of the students and the farmers. After this, board meetings are held for analysing their competencies and skills.
Using information systems with latest and modern technologies is beneficial for BEGA Cheese LTD in terms of manufacturing efficient and effective quality cheese. Information related to the product specifications is crucial in terms of labelling the packed cheese. The company can make of transaction processing systems.
Transaction processing systems would be effective in recording the specific information related to the transactions. Record keeping policies would assist the personnel in storing the transaction related data in a safe and secured manner. Along with this, installing privacy cookies and policies in the transaction processing systems would help in maintaining the safety and privacy of the confidential transaction codes (Ferrão et al. 2016).
Conclusion
Dairy and food processing industry of Australia occupies greater share in the Australian market. One such brand is BEGA Cheese LTD, which deals in the processing of cheese, spreads, bionutrients among others. Quality tests and assurances provides competitive advantage to the brand in terms of luring the customers. Usage of effective information system like transaction processing system would be effective for the personnel in recording all the transaction related information.
References and bibliography
Agriculture.gov.au 2018. Meat, wool and dairy. Available at: https://www.agriculture.gov.au/ag-farm-food/meat-wool-dairy/dairy [Accessed on 25th September 2018]
Augustin, M.A., Riley, M., Stockmann, R., Bennett, L., Kahl, A., Lockett, T., Osmond, M., Sanguansri, P., Stonehouse, W., Zajac, I. and Cobiac, L., 2016. Role of food processing in food and nutrition security. Trends in Food Science & Technology, 56, pp.115-125.
Begacheese.com.au 2018. About us. Available at: https://www.begacheese.com.au/ [Accessed on 25th September 2018]
Desai, D.A., Kotadiya, P., Makwana, N. and Patel, S., 2015. Curbing variations in packaging process through Six Sigma way in a large-scale food-processing industry. Journal of Industrial Engineering International, 11(1), pp.119-129.
Ferrão, L.L., Silva, E.B., Silva, H.L.A., Silva, R., Mollakhalili, N., Granato, D., Freitas, M.Q., Silva, M.C., Raices, R.S.L., Padilha, M.C. and Zacarchenco, P.B., 2016. Strategies to develop healthier processed cheeses: Reduction of sodium and fat contents and use of prebiotics. Food Research International, 86, pp.93-102.
Haq, A.N. and Boddu, V., 2015. Analysis of agile supply chain enablers for Indian food processing industries using analytical hierarchy process. International Journal of Manufacturing Technology and Management, 29(1-2), pp.30-47.
Haq, A.N. and Boddu, V., 2017. Analysis of enablers for the implementation of leagile supply chain management using an integrated fuzzy QFD approach. Journal of Intelligent Manufacturing, 28(1), pp.1-12.
Kumari, S. and Sarkar, P.K., 2016. Bacillus cereus hazard and control in industrial dairy processing environment. Food Control, 69, pp.20-29.
Mirabella, N., Castellani, V. and Sala, S., 2014. Current options for the valorization of food manufacturing waste: a review. Journal of Cleaner Production, 65, pp.28-41.
Munir, M.T., Yu, W., Young, B.R., Wilson, D.I., Information, I. and Centre, C., 2015. The current status of process analytical technologies in the dairy industry. Trends in Food Science & Technology, 43(2), pp.205-218.
Pca.com.au 2018. Company profile. Available at: https://www.pca.com.au/pca-profile/
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