Pestle Anaylsis of Snack Food free essay sample

Even we have to bulky purchase from suppliers, it does not affect us so much since the production of preserved fruits is most important part and we own the formula ourselves. 2. Substitutes |Analysis Criteria |Risk Rating | | |High |Medium |Low | |The relative price performance of substitutes |V |   |   | |Switching Costs |V |   |   | |Buyer propensity to substitute    |   |V | |Overall Risk Rating |V |   |   | Preserved fruits are not the compulsory daily items, they can be substituted by any snacks like candy, chips etc. Most of the substitutes are lower price than ours, the product types are more diversified and the packages are fancier as well. More, the promotion are all around us, for example, TV advertisement, magazines, internet etc. Therefore, there are easy to get the information from the substitutes. However, there are several types of people are quite high loyalty on the preserved fruits such as 60’s-70’s people and the Chinese traditional pr eserved fruits which are HK-made seekers. We will write a custom essay sample on Pestle Anaylsis of Snack Food or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page 3. Buyers Analysis Criteria |Risk Rating | | |High |Medium |Low | |Differentiation of outputs |? |? |V | |Switching costs |V |? |? | |Presence of Substitutes |V |? |? | |Industry concentration relative to buyer concentration |V |? |? | |Importance of volume to buyers |? |? |V | |Cost relative to total buyer purchases |V |? |? |Impact of outputs on the cost of differentiation |? |? |V | |Buyer information about supplier products |? |V |? | |Threat of backward integration |? |V |? | |Overall Risk Rating |V |? |? | Though our products distribution are poor which are no official website, not enough media exposure, some products can be homemade, lesser and lesser HK-made Chinese traditional preserved fruits in HK, so it should be a certain buyers. Since there are lots of substitutes (candy, chips etc) can be replaced preserved fruits and their promotion are all around us like to through the media, internet, they just pay no cost to switch to the substitutes. They can buy the products almost everywhere as convenient shops, supermarkets, stores etc. Also preserved fruits are the insignificant to the buyers overall purchase, so buyers usually do not purchase bulky. 4. New Entrants |Analysis Criteria |Risk Rating | | |High |Medium |Low | |Economies of scale |? |? V | |Proprietary product differences   |? |? |V | |Brand identity |? |? |V | |Switching costs |? |V |? | |Capital requirements |? |? |V | |Access to distribution |V |? |? | |Absolute cost advantage |? |? V | |Government policy |? |? |? | |Expected retaliation |V |? |? | |Industry Profitability |? |? |V | |Stage in industry life cycle |? |V |? | |Overall Risk Rating |? | |V? | The industry of handmade Chinese traditional preserved fruits is in declining in HK, more relat ed-products which are not handmade are rising like the resellers, wholesalers (Aji Ichiban, Okashi Lan). More, our promotion channels are weak because of no official company website and poor media advertisements, it’s quite hard for buyers to have bulky purchase by using the order list from the company website. However, there are 20 retails shops located at the Kowloon, New Territories and Hong Kong Island where most of the shops are closed to commercial buildings, shopping malls and the housing estates. Buyers can buy the products easily. For the reason of lesser and lesser companies to produce the products in HK themselves, that’s the key selling point of our company! And especially the King Preserved Plum ( ) is the signature of our company, therefore, many people are willing to pay higher price to buy the products in HK-made Chinese traditional preserved fruits with good quality. 5. Rivalry Competitors Analysis Criteria |Risk Rating | | |High |Medium |Low | |Industry Growth Rate |   |   |V | |Product Differences |   |   |V | |Brand Identity |   |   |V | |Sw itching Costs |   |V |   | |Informational Complexity |   |   |V | |Concentration and balance |   |   |V | |Industry Commitment   |   |V |   | |Exit Barriers |V |   |   | |Overall Risk Rating |   |   |V | We have a large investment in producing preserved fruits and equipments, unless there is a buyer for preserved products, they may need to remain in the industry even if it is not profitable. Since we can change the suppliers easily, but the more important part is the production, so the cost to quality check for final products are high. And there are rare companies to produce HK-made preserved fruits, the competitors are trying to commitment the industry. Though there are lots of related-products resellers and wholesalers like Aji Ichiban, Okashi Lan, they are just purchase from worldwide, not the HK-made. Lots of people are willing to pay higher to buy the HK-made productions rather the non-HK-made products reseller and wholesalers. The fatal point is we are the well-known as the HK-made Chinese traditional preserved fruits company and even the King Preserved Plum ( ) is the signature of our company. 6. Summary five_force |Risk | |suppliers |Low | |substitutes |High | |buyers |High | |new entrants |Low | |rivalry competitors |Low | |overall |Medium |