PESTEL, 5-Forces, Ice-Fili

1543 words 7 pages
Question 1. –(refer to appendices on p.5)
Political
1) From 1991-1998 No longer anti-alcohol campaign to boost ice-cream industry. Ice cream industry had to complete with substitute products.
2) Since 1998 Financial Crisis, Russian rubles devalued by two-thirds. Russians cannot afford foreign products and companies relied more on national suppliers.
3) 1999 VAT raise. Fruit-based ice-creams and popsicles raised to 20% VAT. Consumer buy less ice-cream because of elastic demand, revenue is less.
Economical
1) Privatized companies must overcome bad infrastructure, to create value in Primary and Support activities, and to extend the maximum market share.
2) In ice-cream industry, Ice-Fili’s competitor, Nestlé, built Nestlé’s own
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To tackle significant 5.7% packaging cost was reasonable. It may spend too much on improve lower cost Freezing system but spent less than 10 % on production, let “Older generation equipment” produced 25% production capacity was obviously insufficient. Ice-Fili did not tackle high repair & maintenance cost.
Buyers’ Power
Ice-Fili planned their Product range with 170 different ice cream plus 20 new products every year. That let buyer to have more choice was creating far less sufficiency on cost control. Under poor financial position in 2002, simply should focus traditional intangible brand Lakomka and other most profitable ice-cream!
Supplier Power
1) Ice-Fili kept 3-4 suppliers only. Kabuzenka stated Ice-Fili constantly received “new one” offers, but didn’t diversify more suppliers. High Suppliers Power remained.
2) Ice-FIli never hedged foreign currencies that can cost less to buy foreign products.

Question 4. –(refer to appendices on p.8)
Arenas- Red Ocean (substitute products), Blue Ocean (Dry-Ice Market & theme park)
Invest Foreign Dry Ice Market- Ice-Fili must ensure they were investing Star Market rather than Question Marks market. If not a Star Market, Ice-Fili should not invest.
Invest Ice Cream theme park- Ice-Fili located nearby Moscow. It is inexpensive to set, and easy to attract some visitors to visit theme park. i) Introduce company’s history ii) watch brief production process, iii) let visitors

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