Case Study Report :: Green Mountain Coffee & Keurig Coffee

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Company Information
Name :: Green Mountain Coffee Roasters, Keurig Coffee
Website :: www.greenmountaincoffee.com, www.gmcr.com, www.keurig.com Industry :: Processed & Packaged Goods- Coffee Makers
Background & History
Green Mountain Coffee Roasters, Inc. (GMCR) was founded in 1981 as a small café and combined with Keurig in 2006 (About GMCR, 2004-2009). GMCR produces specialty coffee and coffee makers; Keurig is the maker of a single cup coffee maker as well as specialty teas and coffees. Keurig was founded in 1998 on the concept that one should be able to make coffee one cup at a time rather than one pot at a time (Coffee.org, unknown). Today, GMCR has acquired and merged with several specialty coffee brewers and Keurig licenses the patents for creating single cup, or K-cup, coffee packages including Dunkin Donuts and Starbucks coffee (Dess, Lumpkin, Eisner, & McNamara, 2012).

SWOT Analysis
Strengths- Brand strength- Unique & large variety of products- Customer loyalty- Environmentally conscience, socially responsible- Innovative products and research- Strong growth potential- Product consistency| Weaknesses- Not a strong online presence- Supplier dependence- Concentrated customer base- Single product line- Returns- Keurig defects- Capacity constraints| Opportunities- Expanding to new markets- Collaborations- Increased purchases - Keurig Acquisition- Expansion to hotels and businesses- Expand suppliers| Threats- Intense Competition- Changing consumer tastes- Large variety of products in the industry- Instability in coffee growing regions- Food and Safety Regulations- Patents expiration | (Dess, Lumpkin, Eisner, & McNamara, 2012)

* Product differentiation; customer loyalty and brand identity * High cost and risk
* Access to distribution and suppliers
* Product differentiation; customer loyalty and brand identity * High cost and risk
* Access to distribution and suppliers
Potential Entrants
{Threat of new entrants :: LOW}
Potential Entrants
{Threat of new entrants :: LOW}
Porter’s Five Forces Model Analysis

Suppliers
{Bargaining power of suppliers :: MEDIUM}
Suppliers
{Bargaining power of suppliers :: MEDIUM}

Buyers
{Bargaining power of buyers :: HIGH}
Buyers
{Bargaining power of buyers :: HIGH}

Industry Competitors
{Rivalry among existing firms :: HIGH}
Industry Competitors
{Rivalry among existing firms :: HIGH}

* Low switching cost
* Large availability of product
* Products are similar and easily substituted & found * Low profits for chain stores create incentives to lower costs

* Low switching cost
* Large availability of product
* Products are similar and easily substituted & found * Low profits for chain stores create incentives to lower costs

* Market can change in short time
* High demand/ low supply for product can allow suppliers to raise prices * Mass commodity product lowers suppliers power
* Difficult to substitute suppliers
* Market can change in short time
* High demand/ low supply for product can allow suppliers to raise prices * Mass commodity product lowers suppliers power
* Difficult to substitute suppliers

* Several options that have low switching cost
* Lack of differentiation between different brands
* Number of local and online competitors
* Products can be purchased from grocery stores and specialty places like Starbucks, Dunkin Donuts * Several options that have low switching cost
* Lack of differentiation between different brands
* Number of local and online competitors
* Products can be purchased from grocery stores and specialty places like Starbucks, Dunkin Donuts

* Customers have several options for alternative beverages * Low cost of switching to substitutes
* Customer preferences can change in product or type of beverage (tea, soda, alcohol) * Customers have several options for alternative...
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