When considering the ever-changing and highly competitive globalized landscape of today's food industry, firms must stay at the cutting edge of their respective fields in order to sustain profitability in the long-term. Accordingly, companies are faced with the continuous task of finding new ways to understand and subsequently accommodate the shifting needs of customers and shareholders, while simultaneously securing lucrative business models and job environments. The Giant Consumer Products Corporation (in particular its frozen food division, which is also its driving operational force) is facing a multitude of barriers on the road to the sustainment of profitability. While trying to contend with growing levels competition and the emergence of countless convenient organic alternatives, this firm must find a way to reach these emerging market segments and compete profitably with young progressive market entrants. For, despite this organization's historic dominance in the frozen food sector, countless new trends are emerging which are encouraging the consumption of healthier, fresher and more locally sourced produce. Several of these movements have attracted the attention of governments, which have granted subsidies to those choosing to patronize healthy food sources like farmer's markets and farmers choosing to cultivate organic produce . What is more, this movement is also being supported by several highly recognizable celebrity chefs, like Jamie Oliver, who are offering several new and convenient alternatives to frozen meals . Therefore, with the genuine emergence of this movement in the food industry and the increasing amount of negative press being directed at more traditional food companies (that is, those who do not produce chiefly organic products), it certainly seems like Giant Consumer Products Inc. needs to reevaluate its strategic approach and diversify its product lines.
The Giant Consumer Products Corporation has maintained a solid market share (more than 40%) in the frozen food industry for several years and has been a Wall Street favorite through its maintenance of an above-industry average growth rate for an equally significant period . However, as the recession began to strike the globe in 2008, the company began to realize a substantial diminishment in sales numbers and marketing margins . While many companies were in the same boat, the organization simply attributed this to the tight financial times. Nevertheless, as the firm took some protective actions and waited out the worst of the fiscal storm, they began to realize that their frozen food numbers were not rebounding at the same pace as some of their other departments and non-food industry counterparts. This was certainly alarming and the firm began to discuss new options, especially in the field of marketing. While executives at Giant Consumer Products Inc. were concerned about the cheapening of the brand through extensive promotional expenditures, the profitability shortfall that the organization was facing caused them to open the door to further marketing channels . Noting the significant differences in each of Giant Consumer Products Inc.'s frozen food product lines, the decision of which line to promote became absolutely critical. The two frontrunners were undoubtedly Dinardo's, a line of Italian meals, and Natural Meals, more sophisticated, expensive and healthy fare . The Dinardo's products were already available in a variety of sizes and represented the greatest share of Giant Consumer Products Inc.'s traditional frozen food department . Natural Meals, on the other hand, were only available in one size and were created to accommodate the needs of a niche market . Nevertheless, while focusing almost exclusively on growth numbers throughout this relatively rough patch, the company ultimately decided to initiate a nationwide promotion for Natural Meals, as this brand exhibited much greater growth statistics.
Without question, this was the right decision for the Giant Consumer Products Corporation. The emergence of organic produce as a genuine alternative was close, and consumers were growing evermore cognizant of the quality of their food . Therefore, it seems clear that the promotion of their healthier alternative was certainly in line with the changing times. Nevertheless, knowing the momentum that the organic foods movement has gained since the time of the initial recession and being that this certainly seems more like a true revolution as opposed to a passing fad, Giant Consumer Products Inc.'s decision does seem a bit sectarian and segregative . Surely this strategic move was a means of resuscitating stunted growth projections and climbing out of a difficult financial hole. However, noting the lasting nature of the aforementioned revolution, it would behoove the Giant Consumer Products Corporation to take a more comprehensive approach to this healthy shift. In other words, it would undoubtedly be helpful across the board for this firm to increase the healthiness of their products. Thus, the historically dominant Dinardo's product line should include healthier ingredients and perhaps new and healthier dishes. From the supply side of the equation, Giant Consumer Products Inc. could also take an active approach to formulating supplier relationships with more organic farms and encouraging their current suppliers to cultivate more organic produce. This would increase the organic content within all of their product lines and help to attract new members of this increasingly influential and ever-growing progressive market segment.
Additionally, through an idealized version of the comprehensive restructuring of operational and supplier inputs, the Giant Consumer Products Corporation could also try its hand in the fresh organic produce sector. Being that there has been such significant growth in organic food consumption, there would seemingly be little downside to this type of entrance . Additionally, this approach would also likely require little in the form of operational expenditures because the Giant Consumer Products Company could strategically utilize its already massive distribution network and packaging facilities for these new fresh products. By doing so, this large firm could bolster its revenue share in this market (one which is normally dominated by suppliers themselves) while also strengthening its relationships with subsidized suppliers. Furthermore, the organization would be actively showing its customer base that is it ready and willing to meet their needs and provide them with the healthy options they demand. By comprehensively embracing this lasting trend, it certainly seems like the Giant Consumer Products Corporation would be positioning themselves for great levels of future success and renewed levels of sustainable growth.
However, there is a chance that such a cumulative change would prove to not be cost-effective. Being that such massive changes would likely have to take place at many levels of the production, management and supply cycles, this is certainly a real possibility. Therefore, in such a case, the Giant Consumer Products Corporation could further its original strategy and increase its profits through the exploitation of its chosen brand. The enhancement of this strategy would involve the brand-wide diversification of Natural Meals. That is, the firm would have to conduct research to determine at least three portion sizes that would be directly attractive to the organic market segment. Additionally, assuring that all packages have the word "organic" on them and assuring that the products meet the standards of organic produce is absolutely critical for successful sustenance in this arena. In fact, it has been shown that organic labeling is one of the key factors in attracting progressive eaters to try new food products . Also, in adding the organic component to labels, it would be helpful to redesign the entire presentation of the product with either new packaging or simply artful labeling, each of which would create a sense newness surrounding the product. Both of such tactics (that is, redesigning the label/packaging and adding the word "organic") would certainly draw the attention and spark the interest of the desired customer base.
Without question, this more singular alternative would certainly require some hefty expenditure. However, such costs would likely be much less than those of the previously mentioned comprehensive approach. Thus, a thorough and diligent cost-analysis must be conducted before integrating one of these recommendations. Such an investigation should consider both short-term and long-term projections and weigh the current industrial conditions. The final decision should be made only after determining the firm's capacity for such changes, their suppliers' capacity for such changes and an in depth consultation with shareholders.
Ultimately, I would personally advocate a comprehensive approach towards healthy and organic food options. I believe that such products will always have a place in the market and the organic movement will continue to gain momentum as it has in recent years. A comprehensive overhauling of Giant Consumer Products Inc.'s product lines and supplier infrastructure would poise this company for great levels of future success by allowing them to capture a substantial market share in this critical sector. Thus, I feel like this would be the best option for sustained profitability in the long-term. However, I understand that the needs and interests of shareholders must be taken into account in this situation and if it were determined that such a massive shift would be highly detrimental to the short-term interests of these vested individuals, I would continue to advocate this approach, though I would lengthen the timeline for its cumulative integration.…