Ben & Jerry Essay

2182 words - 9 pages

Jackie Hunter Dr. Herring Jerry & Ben Case 1994. Analyze Ben & Jerry's competitive environment using the Five Force Framework; i.e., for each of the five forces, state whether the threat or the power of that force is high, medium, or low, and explain why.Threat of new entrants is high. There are several reasons why the threat of new entrants is high. One is due to the fact that Dreyer's is one of Ben & Jerry current distributors. Dreyer's could decide to backward vertically integrate into the production of superpremium ice cream, and that would be a threat. There is also, Edy's Manufactured by Dreyer's who produce half of Ben & Jerry's output.Just recently Dreyer's received a huge cash flow from Nestle giving them an increase in competitive.Threat of substitutes is high. Though out the industry there were a number of reasons why the substitutes were high. The fact that customers are choosing ice cream industry that included ordinary, premium and superpremium products. The super premium ice cream and the frozen yogurt are highly competitive today.Intensity of rivalry is high. The rivalry is high because there are very few major competitors in the industry that are capturing the same market. Ben & Jerry is faced with the increase competition from Haagen-Dazs, who are producing and expanding their selection of flavors. Haagen-Dazs also started a price war by reducing its prices and offering a variety of promotion and discounts. The strongest competitor is Haagen-Dazs, company Inc. and forty-two percent of the market and others including Colombo, Dannon, Healthy choice, Simple Pleasures, Élan, & Frusen.Power of suppliers is high. Due to the facts that Ben & Jerry has chosen suppliers that don't use any type of drugs in their supplies this cause the supplier to be limited. For every product Ben & Jerry uses there are reason behind each one. For Ben & Jerry to get the quality they want the company don't mine paying high premium for exchange to ensure them they will not use rBGH. Ben and Jerry also use suppliers that give a portion of their profits to non-profit organizations. These suppliers for Ben & Jerry can raise the price or reduce the quality of purchased goods or services. The Brownies used in its chocolate fudge are brought from Yonkers, New York, which hires under trained and under skilled workers and the profit goes to house the homeless and teach them trades. The nuts are supplied from the Rainforest that goes in the crunch ice cream is grown in South American rain forest, and a portion of the funds are used for environment preservation. The Blueberries grown and harvest by passamaquoddy Indians of Maine. Also the peaches are from Georgia and part of these fund are used for the company policy to support family farmers. The milk supplier is from Vermont dairy farms where the price is above market value and that is due to the fact that they want use the drug rBGH that increase the milk...

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