The London 2012 Olympic Games Case Study Solution & Analysis
The London 2012 Olympic Games is currently one of the biggest food chains worldwide. It was founded by Henri The London 2012 Olympic Games in 1866, a German Pharmacist who initially launched "Farine Lactee"; a combination of flour and milk to feed babies and decrease mortality rate.
The London 2012 Olympic Games is now a transnational company. Unlike other multinational business, it has senior executives from different nations and attempts to make decisions thinking about the entire world. The London 2012 Olympic Games Case Study Help presently has more than 500 factories around the world and a network spread across 86 countries.
The purpose of The London 2012 Olympic Games Corporation is to enhance the quality of life of people by playing its part and providing healthy food. While making sure that the company is succeeding in the long run, that's how it plays its part for a much better and healthy future
Nestlé's vision is to provide its consumers with food that is healthy, high in quality and safe to eat. It wants to be ingenious and at the same time comprehend the needs and requirements of its consumers. Its vision is to grow fast and offer products that would please the needs of each age. The London 2012 Olympic Games pictures to establish a trained labor force which would help the company to grow.
Nestlé's objective is that as currently, it is the leading business in the food industry, it believes in 'Great Food, Excellent Life". Its objective is to supply its customers with a variety of options that are healthy and finest in taste also. It is concentrated on providing the very best food to its consumers throughout the day and night.
The London 2012 Olympic Games has a large variety of items that it provides to its customers. In 2011, The London 2012 Olympic Games was listed as the most rewarding company.
Goals and goals.
• Keeping in mind the vision and objective of the corporation, the business has laid down its objectives and goals. These objectives and objectives are noted below.
• One goal of the business is to reach zero landfill status.
• Another objective of The London 2012 Olympic Games is to squander minimum food during production. Most often, the food produced is wasted even prior to it reaches the customers.
• Another thing that The London 2012 Olympic Games is working on is to enhance its packaging in such a method that it would assist it to lower the above-mentioned complications and would likewise guarantee the shipment of high quality of its items to its customers.
• Meet worldwide standards of the environment.
• Construct a relationship based upon trust with its customers, service partners, employees, and federal government.
Just Recently, The London 2012 Olympic Games Case Study Solution Company is focusing more towards the strategy of NHW and investing more of its profits on the R&D innovation. The nation is investing more on mergers and acquisitions to support its NHW strategy. The target of the business is not attained as the sales were expected to grow greater at the rate of 10% per year and the operating margins to increase by 20%, offered in Exhibit H.
Analysis of Existing Strategy, Vision and Goals.
The present The London 2012 Olympic Games technique is based on the principle of Nutritious, Health and Wellness (NHW). This technique deals with the idea to bringing change in the consumer preferences about food and making the food things healthier worrying about the health issues.
The vision of this method is based on the key approach i.e. 60/40+ which simply suggests that the items will have a rating of 60% on the basis of taste and 40% is based upon its dietary worth. The items will be made with additional dietary value in contrast to all other products in market acquiring it a plus on its nutritional material.
This strategy was embraced to bring more nutritious plus delicious foods and beverages in market than ever. In competitors with other companies, with an intent of keeping its trust over clients as The London 2012 Olympic Games Business has actually gotten more trusted by costumers.
Microenvironment Analysis (PESTEL Analysis).
The analysis used to determine the position of business in the market is done by utilizing PESTLE analysis, offered in Display A. The London 2012 Olympic Games works under the guidelines and guidelines directed by government and food authority. The business is more focused on its items and services to make sure about the item quality and security.
The political effect on the company is greatly influenced by the public law and regulations. The business has to fulfill its requirements offered by federal government otherwise it needs to pay fine. The London 2012 Olympic Games is significantly supported by Federal government to fulfill all the requirements of standards like acts of health and wellness. In efforts to produce great food, The London 2012 Olympic Games is altering the requirements of food and beverage manufacturing. This might trigger the infraction of governmental rules and guidelines.
Initiation of business where the capital earnings of each individual matters for the increased net sale as this varies country-to-country. The economy of the The London 2012 Olympic Games Company in U.S. is growing year by year with variable products launch particularly focusing on the nutritional food for infants.
The social environment keeps altering with regard to time like the attitude of the consumer in addition to their lifestyles. Any services or product of any business can not achieve success till the business is not worried about the living system of the customer. The London 2012 Olympic Games is taking procedures to satisfy its objectives as the world is in search of healthy and tasty food.
In the advancement of company, tactical steps are rather mandatory. The London 2012 Olympic Games is one of the leading popular international firm and by time it purchases various departments to take its items to new level. The London 2012 Olympic Games is investing more on its R&D to make its products healthier and healthy supplying consumers with health benefits.
There is no such impact of legal factors of The London 2012 Olympic Games as it is more worried over its guidelines and laws.
The London 2012 Olympic Games, in regards to ecological impact is dedicated to work in environment-friendly environment with conservation of the natural deposits and energy. If the resources utilized are recyclable or not, as due to the manufacturing of larger number of items there may be a risk.
Competitive Forces Analysis (Porter's Five Forces Design).
The London 2012 Olympic Games Case Study Solution has obtained a variety of companies that helped it in diversification and growth of its product's profile. This is the detailed description of the Porter's design of 5 forces of The London 2012 Olympic Games Business, given in Exhibition B.
There is extreme competition in the industry of food and beverages. The London 2012 Olympic Games is one of the top business in this competitive market with a number of strong rivals like Unilever, Kraft foods and Group DANONE. The London 2012 Olympic Games is running well in this race for last 150 years. Each company has a definite share of market. This rivalry is not simply restricted to the price of the item however also for development, quality and variation. Every industry is making every effort hard for the maintenance of their market share. The competition of other business with The London 2012 Olympic Games is rather high.
Hazard of New Entrants.
A number of barriers are there for the new entrants to take place in the consumer food market. Just a few entrants prosper in this industry as there is a requirement to comprehend the consumer need which needs time while recent competitors are well aware and has progressed with the consumer loyalty over their items with time. There is low risk of new entrants to The London 2012 Olympic Games as it has rather large network of circulation internationally dominating with well-reputed image.
Bargaining Power of Providers.
In the food and drink market, The London 2012 Olympic Games Case Study Solution owes the biggest share of market requiring greater number of supply chains. In response, The London 2012 Olympic Games has likewise been worried for its providers as it thinks in long-term relations.
Bargaining Power of Purchasers.
There is high bargaining power of the buyers due to excellent competitors. Changing expense is rather low for the customers as numerous companies sale a number of comparable products. This appears to be an excellent hazard for any company. Hence, The London 2012 Olympic Games Case Study Solution ensures to keep its consumers pleased. This has led The London 2012 Olympic Games to be one of the faithful business in eyes of its buyers.
Danger of Alternatives.
There has been a terrific danger of alternatives as there are replacements of some of the Nestlé's products such as boiled water and pasteurized milk. There has actually likewise been a claim that some of its products are not safe to use leading to the decreased sale. Therefore, The London 2012 Olympic Games began highlighting the health benefits of its items to cope up with the alternatives.
It has actually ended up being the second biggest food and beverage market in the West Europe with a market share of about 8.6% with just a difference of 0.3 points with The London 2012 Olympic Games. The London 2012 Olympic Games draws in regional customers by its low expense of the item with the local taste of the items preserving its very first location in the international market. The London 2012 Olympic Games Case Study Solution company has about 280,000 staff members and functions in more than 197 countries edging its competitors in many regions.
Note: A short comparison of The London 2012 Olympic Games with its close competitors is given in Exhibit C.
The internal analysis and external of the company likewise can be done through SWOT Analysis, summed up in the Exhibit F.
• The London 2012 Olympic Games has an experience of about 140 years, allowing company to much better perform, in various scenarios.
• Nestlé's has existence in about 86 countries, making it a global leader in Food and Drink Market.
• The London 2012 Olympic Games has more than 2000 brands, which increase the circle of its target consumers. Famous brand names of The London 2012 Olympic Games include; Maggi, Kit-Kat, Nescafe, etc.
• The London 2012 Olympic Games Case Study Help has large big of spending costs R&D as compare to its competitors, making the company business launch introduce nutritious ingenious innovative products.
• After adopting its NHW Strategy, the company has done big quantity of mergers and acquisitions which increase the sales development and enhance market position of The London 2012 Olympic Games.
• The London 2012 Olympic Games is a popular brand with high consumer's loyalty and brand recall. This brand name commitment of consumers increases the opportunities of easy market adoption of different brand-new brands of The London 2012 Olympic Games.
• Acquisitions of those service, like; Kraft frozen Pizza service can offer an unfavorable signal to The London 2012 Olympic Games customers about their compromise over their core competency of much healthier foods.
• The development I sales as compare to the business's financial investment in NHW Technique are rather various. It will take long to change the perception of individuals ab out The London 2012 Olympic Games as a business offering nutritious and healthy products.
• Introducing more health associated products enables the company to catch the market in which customers are quite conscious about health.
• Developing nations like India and China has biggest markets in the world. Hence broadening the market towards developing nations can enhance the The London 2012 Olympic Games business by increasing sales volume.
• Continue acquisitions and joint endeavors increases the marketplace share of the company.
• Increased relationships with schools, hotel chains, restaurants and so on can likewise increase the number of The London 2012 Olympic Games Case Study Help consumers. For instance, teachers can advise their students to purchase The London 2012 Olympic Games items.
• Economic instability in nations, which are the possible markets for The London 2012 Olympic Games, can produce numerous problems for The London 2012 Olympic Games.
• Shifting of products from normal to healthier, results in additional expenses and can result in decline business's revenue margins.
• As The London 2012 Olympic Games has a complicated supply chain, for that reason failure of any of the level of supply chain can lead the business to face specific issues.
The market segmentation of The London 2012 Olympic Games Case Study Solution is based upon 4 elements; age, gender, occupation and earnings. For instance, The London 2012 Olympic Games produces a number of products related to infants i.e. Cerelac, Nido, etc. and associated to grownups i.e. confectionary products. The London 2012 Olympic Games products are quite inexpensive by nearly all levels, however its significant targeted clients, in regards to earnings level are middle and upper middle level customers.
Geographical division of The London 2012 Olympic Games Case Study Help is composed of its presence in practically 86 nations. Its geographical segmentation is based upon 2 primary aspects i.e. average income level of the customer in addition to the environment of the region. For example, Singapore The London 2012 Olympic Games Company's segmentation is done on the basis of the weather of the region i.e. hot, warm or cold.
Psychographic division of The London 2012 Olympic Games is based upon the personality and life style of the client. The London 2012 Olympic Games 3 in 1 Coffee target those customers whose life style is rather hectic and do not have much time.
The London 2012 Olympic Games Case Help behavioral segmentation is based upon the mindset understanding and awareness of the client. Its highly healthy products target those customers who have a health mindful mindset towards their consumptions.
The VRIO analysis of The London 2012 Olympic Games Company is a broad range analysis supplying the organization with a possibility to acquire a practical competitive advantage against its competitors in the food and drink industry, summarized in Exhibition I.
The resources used by the The London 2012 Olympic Games business are important for the company or not. Such as the resources like financing, human resources, management of operations and specialists in marketing. This are some of the essential important elements of for the recognition of competitive advantage.
The valuable resources used by The London 2012 Olympic Games are expensive or even unusual. , if these resources are frequently discovered that it would be easier for the competitors and the new rivals in the market to easily move in competitors.
The replica procedure is pricey for the rivals of The London 2012 Olympic Games Case Solution Company. Nevertheless, it can be done just in two various strategies i.e. product duplication which is produced and produced by The London 2012 Olympic Games Company and introducing of the alternative of the products with changing cost. This increases the threat of disruption to the current structure of the market.
This part of VRIO analysis handle the compatibility of the business to place in the market making efficient usage of its important resources which are tough to imitate. Often, the advancement of management is absolutely based on the company's execution strategy and team. Therefore, this polishes the abilities of the company by time based upon the decisions made by firm for the progression of its strategic capitals.
R&D Costs as a portion of sales are declining with increasing real quantity of costs shows that the sales are increasing at a higher rate than its R&D spending, and permit the company to more spend on R&D.
Net Profit Margin is increasing while R&D as a percentage of sales is declining. This indication likewise shows a green light to the R&D spending, mergers and acquisitions.
Debt ratio of the business is increasing due to its spending on mergers, acquisitions and R&D development rather than payment of financial obligations. This increasing debt ratio present a threat of default of The London 2012 Olympic Games to its investors and might lead a declining share prices. In terms of increasing debt ratio, the company should not invest much on R&D and must pay its existing financial obligations to reduce the risk for financiers.
The increasing risk of financiers with increasing debt ratio and decreasing share rates can be observed by substantial decline of EPS of The London 2012 Olympic Games Case Analysis stocks.
The sales growth of business is likewise low as compare to its mergers and acquisitions due to slow understanding structure of customers. This slow growth likewise prevent company to further spend on its acquisitions and mergers.( The London 2012 Olympic Games, The London 2012 Olympic Games Financial Reports, 2006-2010).
Keep in mind: All the above analysis is done on the basis of graphs and computations given in the Exhibits D and E.
TWOS analysis can be utilized to derive numerous methods based upon the SWOT Analysis offered above. A quick summary of TWOS Analysis is given in Exhibition H.
Techniques to make use of Opportunities using Strengths.
The London 2012 Olympic Games Case Analysis must present more ingenious items by large quantity of R&D Spending and acquisitions and mergers. It might increase the marketplace share of The London 2012 Olympic Games and increase the earnings margins for the business. It might likewise offer The London 2012 Olympic Games a long term competitive benefit over its rivals.
The global expansion of The London 2012 Olympic Games need to be concentrated on market recording of establishing nations by growth, drawing in more clients through client's loyalty. As developing nations are more populous than industrialized countries, it might increase the client circle of The London 2012 Olympic Games.
Strategies to Conquer Weak Points to Make Use Of Opportunities.
The London 2012 Olympic Games Case Solution ought to do mindful acquisition and merger of companies, as it might affect the consumer's and society's perceptions about The London 2012 Olympic Games. It needs to merge and get with those business which have a market track record of nutritious and healthy business. It would enhance the understandings of customers about The London 2012 Olympic Games.
The London 2012 Olympic Games must not only invest its R&D on development, instead of it ought to also focus on the R&D costs over assessment of cost of various nutritious items. This would increase expense performance of its products, which will result in increasing its sales, due to declining prices, and margins.
Strategies to utilize strengths to get rid of hazards.
The London 2012 Olympic Games must move to not only developing however likewise to industrialized countries. It should broaden its circle to numerous nations like Unilever which runs in about 170 plus countries.
Strategies to conquer weaknesses to prevent risks.
The London 2012 Olympic Games Case Analysis should carefully manage its acquisitions to avoid the threat of mistaken belief from the consumers about The London 2012 Olympic Games. This would not only enhance the understanding of customers about The London 2012 Olympic Games however would also increase the sales, profit margins and market share of The London 2012 Olympic Games.
In order to sustain the brand in the market and keep the consumer intact with the brand name, there are 2 choices:.
The Company ought to invest more on acquisitions than on the R&D.
1. Acquisitions would increase overall possessions of the business, increasing the wealth of the company. However, costs on R&D would be sunk expense.
2. The business can resell the acquired units in the market, if it fails to execute its technique. However, quantity invest in the R&D could not be revived, and it will be considered completely sunk expense, if it do not offer potential outcomes.
3. Spending on R&D supply sluggish growth in sales, as it takes very long time to present an item. Nevertheless, acquisitions supply quick results, as it supply the business already developed item, which can be marketed soon after the acquisition.
1. Acquisition of business's which do not fit with the business's values like Kraftz foods can lead the business to deal with mistaken belief of customers about The London 2012 Olympic Games core worths of healthy and nutritious products.
2. Large spending on acquisitions than R&D would send out a signal of business's ineffectiveness of establishing ingenious products, and would outcomes in customer's dissatisfaction.
3. Big acquisitions than R&D would extend the line of product of the business by the products which are already present in the market, making company unable to present new innovative items.
The Business should spend more on its R&D rather than acquisitions.
1. It would make it possible for the company to produce more ingenious products.
2. It would provide the business a strong competitive position in the market.
3. It would enable the business to increase its targeted clients by introducing those products which can be used to a totally brand-new market sector.
4. Ingenious products will offer long term advantages and high market share in long term.
1. It would decrease the profit margins of the company.
2. In case of failure, the entire costs on R&D would be considered as sunk cost, and would affect the company at big. The danger is not in the case of acquisitions.
3. It would not increase the wealth of company, which could offer an unfavorable signal to the financiers, and might result I decreasing stock rates.
Continue its acquisitions and mergers with significant spending on in R&D Program.
1. It would allow the business to introduce new ingenious products with less risk of converting the costs on R&D into sunk cost.
2. It would provide a favorable signal to the investors, as the total possessions of the company would increase with its considerable R&D spending.
3. It would not impact the earnings margins of the business at a large rate as compare to alternative 2.
4. It would offer the business a strong long term market position in regards to the company's general wealth as well as in terms of innovative products.
1. Risk of conversion of R&D spending into sunk cost, greater than option 1 lesser than alternative 2.
2. Danger of misconception about the acquisitions, greater than alternative 2 and lower than option 1.
3. Introduction of less variety of innovative products than alternative 2 and high variety of ingenious items than alternative 1.
With the deep analysis of the above alternatives, it is suggested that the business ought to select the alternative 3 in order to maintain a competitive position in the long run. As the alternative 3 would allow the business to not only present ingenious and brand-new products in the market it would likewise minimize the high expenses on R&D under alternative 2 and increase the earnings margins. It would allow the business to increase its share rates also, as financiers want to invest more in companies with significant R&D spending and boost in the overall worth of the business.
Action and application Technique
Technique can be carried out efficiently by developing certain short term along with long term strategies. These strategies might be as follows;
Short Term Strategy (0-1 year).
• Under the short term strategy The London 2012 Olympic Games Case Analysis ought to perform different activities to execute its NHW technique efficiently. These activities are as follows;.
• Get the audit of its brand name portfolio done, to examine the core selling brands, which generate the majority of its earnings.
• Analyze the current target audience in addition to the market section which is not include in the business's circle.
• Analyze the present monetary data to determine the quantity that needs to be invested in the R&D and acquisitions.
• Examine the potential financiers and their nature, i.e. do they desire long term advantages (capital gain), or the desire early profits (dividend). It would let the business to know that just how much amount ought to be spent on R&D.
Mid Term Plan (1-5 years).
• Get those organizations in which the business has potential experience to handle. Get most beneficial companies with a strong dedication to health, to build the customer's understandings in the best direction.
• Focus more on acquisitions than R&D to construct the base in the customer's mind about The London 2012 Olympic Games values and vision and to avoid prospective risk of sunk expense.
Long Term Strategy (1-10 years).
• Get organizations with health along with taste aspect, as the base for the The London 2012 Olympic Games as a business producing healthy items has been developed under midterm plan and now the company might move towards taste element too to comprehend the consumers, which focus more on taste rather than health.
• Be more aggressive towards R&D than the acquisitions, as it is the substantial time to develop new products.
The London 2012 Olympic Games has actually stayed the top market gamer for more than a years. It has institutionalized its methods and culture to align itself with the market modifications and consumer habits, which has ultimately enabled it to sustain its market share. The London 2012 Olympic Games has actually developed considerable market share and brand name identity in the metropolitan markets, it is recommended that the business must focus on the rural locations in terms of establishing brand name equity, loyalty, and awareness, such can be done by developing a specific brand name allocation method through trade marketing methods, that draw clear distinction in between The London 2012 Olympic Games products and other rival items. The London 2012 Olympic Games needs to take advantage of its brand image of safe and healthy food in catering the rural markets and likewise to upscale the offerings in other classifications such as nutrition. This will enable the business to establish brand name equity for freshly presented and already produced items on a higher platform, making the reliable use of resources and brand image in the market.