This take over has been aided by none other than the FDA, the Food and Drug Administration, along with the U.S. Department of Agriculture. More and more they are coming down with strenuous and tedious regulations that don’t make the food safer, just procedures that make it difficult for the farmer who is trying to grow more pure food. They make it so hard for anyone except a Mega Farmer to produce because they require such a large number of crops and animals to be processed in a short length of time as Joel stated in the Omnivore’s Delimma. (Pollan,2006) Just because a group produces more, doesn’t mean they produce better. There is also a direct correlation between the amount of money these farmers contribute to politicians, as to how much hassle is taken in by the farmers.
23.5 million people in America live in a food desert. A food desert is a geographic area where affordable and nutritious food is difficult to obtain, usually in rural areas and low-income communities. Not being able to have easy access to grocery stores changes multiple things. Most of the time you have to buy multiple of one item to prevent running out. This causes a problem because fruits and vegetables do not stay ripe forever.
Grocery stores are in competition with smaller markets like Kudlers and Whole Foods. If the brand name grocery stores like Ralphs and Vons did not offer organic and specialty items, the market structure of Kudler Fine Foods would differ. This market structure positively affected Kudler because there was no barrier to entrance within the quality foods market. What negatively affects the company with this market structure is that they are compared to big companies who are able to supply some of these rare items at a more competitive price. One of the marketing strategies that ensure the company of long-term profitability is the personal relationship built with the customer base.
The strengths of the company are beneficial for sustenance; however, the weaknesses could pose a threat to the company’s long-term viability and its desire to remain a leader in the region. The structure of Kudler is a monopolistic market structure because there are many stores offering similar products, but differentiated. If Kudler Fine Foods implements the recommendations, it can continue the substantial lead it has in the market as well as expand to become a nationally recognized
Their lack in technology advancements help them back from growing their population to a greater number. So much work had to go into harvesting their crops and they were unable to store things for a long period of time. Their daily work of harvesting food was all they had time for, it's how they were able to survive. Jared says' "Highland agriculture was based on crops like these taro roots, which are very different from cereal crops. Taro is much more work.
Critical Issues Cost Structure & Profit – There is a restaurant style cost structure of a 30/30/30, leaving only 10% for profit. Being manufacturing and a highly leveraged company they have a large amount of fixed costs and their cost structure does not reflect this. Expansion – There is inadequate capital to expand Monforte and securing financing from banks is unlikely due to Monforte’s low profit margins of 10% as well as her unfavourable financial ratios, specifically her acid test ratio of 0.9. Focus – The focus of the organization is blurred. There is a need for expansion; however, there is also a need to meet the requirements put in place about locally grown and produced products as well as high wages for workers.
The weakness of Kudler Fine Foods is that an IPO (Initial Public Offering) has many inherent and potential weaknesses that must be examined prior to selection as a means for expansion. An IPO is the first sale of stock by a company. There are many advantages and disadvantages for the Kudler Fine Foods to go public through the IPO. The advantages include generating more capital needed to expand their three locations The IPOs are very expensive undertaking, and a large portion of any capital acquired will be lost to this cost. Because the company must produce all financial information to the SEC many businesses find it to be very stressful and time consuming which takes time and money away from a company that is thriving like Kudler Fine Foods.
An automated ordering system will help with this issue, as well. Having qualified people in positions such as the baker, wine steward and butcher, are essential to the core values of Kudler Fine Foods. Having to pay them, does make the payroll higher, but it is a cost, that this business will have to pay. Having these people is one reason customers shop there, for the advice, and interaction these people provide. Qualified in store experts, is something that sets this business apart from other stores.
Currently, Kudler Fine Foods is growing, and they have developed a good niche in the specialized gourmet grocery industry. Another strength of the company is the vision and mission statement is being implemented successfully, and they follow the differentiated strategy closely. The company also offers a wide selection of the finest products from all over the world. A weakness for Kudler Fine Foods is that they have not been in the industry for a long period, and no continuity because of the short period of time in the industry, so this is why the company needs to continue to scan the industry for best practices. Kudler Fine Foods also have various opportunities.
However, net profit declined by 7% in 2008 due to substantial increases in the cost of food raw materials. Greggs decided not to pass these cost increases onto consumers since the demand for takeaway food is very sensitive to changes in price. The Greggs business has a divisional structure with central bakeries around the country each supplying the shops in their surrounding areas. The business employs around 19,000 people in a range of jobs, including shop staff, drivers, bakery staff, savoury production, finance, personnel, purchasing and IT. Complex retail IT systems help Greggs management monitor store and product performance, manage cash flows from the tills and deal directly with ingredient and other key suppliers.