Ready To Eat Breakfast Cereal Industry Monday‚ September 09‚ 2013 3:09 PM The Big 3 and the industry before the 1990’s 1972 Federal trade Commission file a major antitrust suit against the big 3 (Kellogg‚ General Mills‚ and General Foods) Argued: Monopolized cereal market and had taken specific steps to deter entry by new firms How? Restrained competition amongst themselves through "unwritten agreements" to limit the in-pack premiums (free toys‚ gifts‚ e tc) -Refrain from trade
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The RTE Cereal Industry in 1994 Case Analysis Competitive Strategy Presented by: Raghav Keshav Why has RTE cereal been such a profitable business? The RTE cereal market is a classic oligopoly with the four dominant players controlling 85% of the market. The return on sales earned by the incumbents in this market (18%) is significantly higher compared to rest of the food industry (5%). Efficient markets typically entice new entrants when the returns are attractive. These returns are gradually
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1 1. Why is the soft drink industry so profitable? An industry analysis through Porter’s Five Forces reveals that market forces are favorable for profitability. Defining the industry: Both concentrate producers (CP) and bottlers are profitable. These two parts of the industry are extremely interdependent‚ sharing costs in procurement‚ production‚ marketing and distribution. Many of their functions overlap; for instance‚ CPs do some bottling‚ and bottlers conduct many promotional activities
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Barriers-to-entry Examples Investment To achieve minimum efficient scale‚ it is estimated that a RTE cereal plant needed to produce 75 million pounds per year‚ which requires a capital investment in excess of $100 million and about 125 employees. High Research and Development Cost The RTE cereal industry spent about 1% of gross sales on R&D in 1993‚ whereas the food industry spent only 0.7% of gross sales. It requires 2-4 years and $5-10 million to develop a new brand Distribution barrier
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1) Substitutability by buyers and suppliers defines the boundaries of RTE cereal industry from a demand-side perspective and a supply-side perspective respectively. The boundaries from a demand-side perspective in this case are the fact that buyers have low switching costs. The cereal industry has a diversified range of products so consumers can easily substitute one type of cereal for another or one brand for another. From the supply-side perspective‚ boundaries are technological in nature such
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what defines them as a person. There are so many different cultures in the world‚ some are similar and others are completely different in every way‚ the list is never ending‚ but why? Why are there so many cultures that exist? Culture is who you are as a person and is based on similar beliefs between you and others. When you actually think about it it’s a way that connects you to everyone in the whole world on a personal level. So why are there so many cultures if we are all the same? When you
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Essay “So many countries‚ so many customs” There are many countries and nations in the world‚ and each of them is characterized by its own customs. In modern society we strive for integration‚ for cross-cultural communication‚ but very often different customs‚ different mentality makes obstacles for achieving results. For example‚ one Russian company carries on negations with some Japanese company. The Japanese do not say directly “Yes” or “No”‚ they think a lot. Russian vice verse do all of a
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Reason for the high-profitability of the RTE cereal business: The "Big Three" cereal manufacturers have jointly monopolized the market and have reaped high profits from their monopoly pricing combined with the tacit co-ordination they share regarding price hikes. The "Big Three" have backed up their monopoly strategy with their strong relationships with each other and with regional and national grocers. This relationship allowed them to control or buy shelf space and ideal positioning of their product
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happiness and joy. So it is their first consideration in all celebrations‚ including weddings. Even the bride`s home is decorated in red on the wedding day. In addition‚ the greater part of people prefers traveling during holidays. Sometimes between people of different nations during their communication emerge various misunderstandings about their conduct. If you don’t know some traditions of the country‚ it can lead to offences; it can even sow seeds of discord between nations. So before going somewhere
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The reason that so many people will cheat when they are on a "diet‚" is because of the fact that the diet is way too restrictive. Some of these fad diets that people choose won’t allow several groups of nutrients‚ such as the low-carbohydrate diets for instance. After you have been on plans like these‚ or say for example‚ plans like those single food diets‚ it is very easy to cheat. When you are not satisfied day after day of being on a diet plan‚ then you will have all the more reason to go off
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