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Performance Of Grupo Bimbo Company Essay

1763 words - 8 pages

Introduction
Grupo Bimbo founded in 1945, is the largest Mexican owned baking and confectionary company which manufactures over 10,000 products under 100 different brands. Some of their biggest confectionary brands are Barcel, Mrs. Baird's, Entenmann's, and Pullman whose products include chocolate bars, hard candies, gummies, licorice, and many more. Their headquarters are located in Mexico City, but they operate on a global scale with their biggest markets being the Americas, Asia and Europe. Grupo Bimbo employs over 125,000 people across 19 different countries. View Appendix B for a SWOT analysis to get quick view of the company's current standing.
VRI
V- Do resources and capabilities meet a market demand? Do they enable a firm to exploit an external opportunity or neutralize an external threat? Grupo Bimbo definitely has the resources and capabilities to meet market demands hands down. This can be seen with through their numerous brands, products, factories and employees. What they don't have is a solid brand image and brand recognition that will carry its sales like Mars, Hershey and the other major players have.
R- Are they rare? Are they controlled by only a small number of competing firms? I would say that confectionary companies are not rare because there are so many big players already (Hershey, Nestle, Mars, Mondelez). With that being said, it doesn't mean that Grupo Bimbo should just shut down, just means they definitely need to be able to come up with good strategy and be able to execute well enough.
I- Is it difficult for competitors to successfully imitate or substitute? Do firms without the resource/capability face a cost disadvantage in obtaining or developing it? In the confectionary industry there are and can easily be plenty of substitutes of a good product, for example gummy bears and gummy worms. If Grupo Bimbo can get a "hot commodity" and capture the market with it, I don't think any substitute would be able to compete because they were the first which is a huge competitive advantage.
I- Sources of Costly Imitation: Historical Conditions, Causal Ambiguity, Social Complexity, Patents?
Like stated previously, imitations are an issue in the confectionary industry, and no matter if you patent your idea or not there will still be substitutes. Also sated before, usually the first to come out with the product captures the market. If Grupo Bimbo just focuses on providing the best quality product possible they will set themselves up with more success than if they just obtain a patent.
Company Performance
The confectionary industries top players including Mars Inc., Nestle and Ferrero are a privately owned and will be unable to compare to Grupo Bimbo. However, Mondelez and Hershey are publically traded and are compared to Grumpo Bimbo as seen in Apendix A.
After viewing Appendix A, you can see that Hershey is a top performer in the confectionary industry by leading in all three categories of ROA, ROE, and profit...

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