Microeconomics Ice Cream Analysis

Only available on StudyMode
  • Download(s) : 1480
  • Published : July 29, 2011
Open Document
Text Preview
ECO 201 : Microeconomics Research Paper
The Unilever Group
Ben and Jerry’s Homemade Inc.
Ice Cream
June 9, 2011
Deborah Minassian
ECO 201 : Microeconomics Research Paper
The Unilever Group
Ben and Jerry’s Homemade Inc.
Ice Cream
June 9, 2011
Deborah Minassian

Abstract
Ben & Jerry’s Homemade, Inc. has been in business since 1978. Approximately 40% of the world's frozen dairy desserts, 5.6 billion liters per year, are manufactured at more than 450 U.S. ice cream plants. This makes the United States the largest producer of ice cream and related products in the world. With the world's largest milk supply, an abundance of land, and investments in research & development, U.S. frozen dairy dessert production has remained steady and strong for many years, and is prepared to do so for many more. The purpose of this paper is to give the reader a microeconomic overview of Ben and Jerry’s Homemade Inc. Topics found in this paper include supply and demand conditions, Ben and Jerry’s competitive advantage, the barriers within the ice cream industry, ice cream substitutes, Ben and Jerry’s market share and the market structure of their business. Introduction

Ben and Jerry’s is a subsidiary of The Unilever Group. The Unilever Group is a large international company that provides consumer goods including foods such as soups, sauces, dressings, noodles, prepared meals, and tea products; home care products for cleaning and deodorizing; and personal products including soaps, shampoos, deodorants and hand creams. The Unilever Group is also the largest producers of ice cream in the world. The Unilever Group was founded in 1930 and is based in London, the United Kingdom. The Unilever Group’s growth strategy embraces a focus in four strategic areas. These areas are: 1. Winning with brands and innovation by offering a diverse portfolio of superior products. 2. Winning in the market place through sustaining winning relationships and to be consistently brilliant at customer service. 3. Winning through continuous improvement by translating efficiency into more competitive costs and an improvement philosophy “a little better every day.” 4. Winning with people through obtaining top talent and investing in training and leadership development. The Unilever Group acquired Ben and Jerry’s on April 12, 2000 for $326 million. The acquisition of Ben and Jerry’s continued The Unilever’s goal of acquiring the best in business. Supply and Demand of Ice Cream

Is there anyone that doesn’t like ice cream? Everyone in my family will ecstatically exclaim “I Scream, You Scream; We All Scream for Ice Cream.”
Ice cream is a highly competitive market and includes many varieties in all sorts of ways. There are not only different flavors of ice cream; it also comes in different forms. You can purchase ice cream flavors in different size containers as well as pre-made cones, bars and bites of all sorts. Is the market competitive? Absolutely! Is the market saturated, one might think it is. As with any consumer product, if companies price their items too high, they will see a drop in demand and therefore the supply will be greater. The demand for ice cream is plentiful all year round. I was one who thought that ice cream was in greater demand in the summer but learned that ice cream is in demand all year around.

Ice cream’s best substitute is frozen yogurt as well as soy, coconut and almond milk frozen products. These ice cream alternatives can prove to be a bit more expensive than ice cream. When the prices of these substitutes are high, the demand for ice cream goes up.

Along with ice cream substitutes we must also consider the complements for ice cream. Complements for ice cream include cones (plain and sugar), hot fudge, whipped cream, nuts and jimmies.
According to The Unilever Group’s Annual Report, they reported a revenue growth rate of 11.0% over the previous year. Since The Unilever Group is a...
tracking img