¶ … Sanitarium Heal & Wellbeing Company is the operating/trading name of twin fod companies (New Zealand Health Association Ltd. And Australian Health and Nutrition Association Ltd.). Both of these companies are owned and operated by the Seventh-Day Adventist Church .The company produces a wide range of breakfast cereals and a wide range of vegetarian products. Sanitarium was founded in 1898 with Weet-Bix being its flagship products that topped sales in the New Zealand and Australian breakfast market. Sanitarium also operated several health food shops in numerous cities before the 1980s.The company has factories in various locations across New Zealand and Australia. In this paper we conduct the company's Organisation, Environmental and Market analysis as well as a determination of its segmentation and positioning strategies.
A SWOT analysis of Sanatorium
In order to conquer and dominate any given market, adequate information is needed on the prevailing market conditions as well as the organization's micro and macro environment.
The SWOT analysis is a tool which is very useful in both the understanding and the process of making decisions for various sorts of situations within a given business (Businessball,2008).As noted by Kotler, a SWOT analysis focuses on the strengths, weaknesses, opportunities as threats of an organization from a critical perspective. The SWOT analysis therefore distils the data that is gathered from these observations in order to i9ndicate the critical items from the external and internal audits. The number of items is noted by Kotler et al. (2005,p.58) to be very small for any form of forceful communications but they are critical in showing the areas that the business needs to focus its attention to. Additionally, the internal and external factors have a very great influence on the business' marketing objectives as noted by Brassington & Pettitt (2005).
The External Environment analysis
The external environment analysis entails the analysis of the opportunities as well as threats. At this stage, the company's main threats and opportunities are identified. The purpose of this analysis is to ensure that appropriate developments are made that can positively impact the company. The opportunities as well as threats can be considered from economic, demographic, technological, market-based, competition, political as well as pressure perspectives (Kotler et al.,2005)
The opportunities as well as threats are noted to have s sharp focus on both the present and the future while taking a more external outlook. This is in consideration of the strategic views of the possible development options. Several opportunities as well as threats are noted to emerge from the prevailing marketing environment. This is in consideration of the demographic as well as cultural factors (Brassington & Pettitt, 2005).It is worth noting that not all threats require the same form of attention, It is therefore critical that every threat be assessed with the potential damage of each being evaluated.
Internal Environmental analysis
The strength as well as weaknesses are noted to have a focus on both the present and the past. The internal environment analysis also focuses on the internally controlled factors like the 4Ps as well as the overall marketing strategy that is employed towards a target market. The external environment must never be ignored totally. Several strengths as well as weaknesses can therefore be defined within a competitive context as noted by Brassington & Pettitt (2005, p. 408).
Strengths
Loyal customer base
Strong brand portfolio
Unique product offering
Production of healthy vegetarian products
Strong financial position backed by finances from the Seventh-day Adventist Church
Dependence on information technology to streamline its logistics and product sales
Weaknesses
A weak management team
Overdependence on the Australian and New Zealand markets
Legal proceedings affecting brand image
Lack of an elaborate online marketing strategy
Opportunities
Emerging markets and expansion abroad
Diversification in regard to venturing into the provision of other products and services.
A growing trend towards healthy living and consumption of vegetarian products
Franchising
Venturing into the soft drink and beverage market to complement the existing product
Premiumrisation
Threats
Stiff competition
Tough government regulations
Low cost competitors as well as imports
Existence of substitute products
Economic downturn which adversely affect consumer spending levels
Strengths
Loyal customer base
Sanitarium is noted to be a very dominant player in the New Zealand's ready-to-eat (RTE) market. It is in fact the leading manufacturer of ready-to-eat (RTE) products.The company has a loyal customer base which is drawn from its vegetarian product line as well as breakfast serials.
Strong brand portfolio
Being the number one manufacturer of ready-to-eat (RTE) products in New Zealand, the company has also managed to maintain a very strong brands portfolio that include the traditional favourites like Weet-Bix, Ricies, Honey Puffs, Skippy as well as other emerging brands like Light 'n' Fruity, Up & Go as well as Muesli (Hoh,2008).The company also...
This made it the fastest growing cereal product within its category.
Unique product offering
The company offers unique products that are tailored to its ever increasing client base.The company have of late resorted to the production of products that are targeting different demographics like allergic customers (with a focus on then production of formulations that are gluten-free).The company also produces product for women (with focus on the issue of weight management) and children ( with a strong focus on health as well as character merchandising).
Production of healthy vegetarian products
The company produces several healthy vegetarian products in order to accommodate the needs of the vegetarian clients as well as the health conscious ones.
Strong financial position backed by finances from the Seventh-day Adventist Church
The company has a strong financial position due to its dominance of the marhet share in both New Zealand and Australia.This is coupled with the fact that it is fully owned by Seventh day Adventist Church, a worldwide religious body with strong financial backing
Dependence on information technology to streamline its logistics and product sales
The company uses several IT services such as the SAP solution -Motorola MC9000 in order to streamline operations in its warehouses and its logistical chains.
Weaknesses
A weak management team
The company does not have a strong management team.This is as evidenced from its Australian operations where workers protested the move by the management to have them sign contracts that violated their terms of service (Sanitarium Workers Campaign For a Union Agreement,2008)
Overdependence on the Australian and New Zealand markets
Legal proceedings affecting brand image
The Company has in certain cases been sued. These law suits affect its brand image negatively
Lack of an elaborate online marketing strategy
The company lacks an elaborate online strategy for the marketing and sales of its products.
Opportunities
Emerging markets and expansion abroad
The company can focus in international expansion strategies in order to make its products and services available to the emerging markets is other regions
Diversification in regard to venturing into the provision of other products and services
The company can diversify its product portfolio to include the cold and hot beverage product lines
A growing trend towards healthy living and consumption of vegetarian products
The general trend towards healthy living can serve to create a market niche for the company's vegetarian products
Franchising
The company can adopt a franchising business model in order to allow it reach a wider audience abroad.
Venturing into the soft drink and beverage market to complement the existing product portfolio
The company can venture into the lucrative soft and hot beverage market
Premiumisation
Hoh (2008) indicated that premiumisation is the incoming trend that involves the expansion of product lines to meet the interest of consumers in exotic flavours as well as quality ingredients.
Threats
A weak management team
The company has a weak management team as witnessed in the worker complaints and its poor relationship with the worker unions.
Overdependence on the Australian and New Zealand markets
The company depends heavily on its Australian and New Zealand operations. This exposes it to risks should the economy of these two countries collapse.
An analysis of the macro environment
A macro environmental analysis involves the description of the business environment that is crucial for the formulation of business strategy. These dimensions are noted by Fahey and Narayanan (1986).It is therefore crucial for managers to carry out analysis of the environment within which they operate in order to fathom the current as well as the potential business changes. The macro-environmental analysis in this case is carried out using a PESTEL analysis.
Sanitorium's PESTEL analysis
Political factors
The operations of Sanitorium are vhighly influenced by the New zealand state policies. These policies include the ones that regulate the health and food industry.Harmful products such as cholestrol that may cause obesity are tightly regulated by the NZ government. The company is also ictated upon by the New Zealand policies regulating health, worker protection as well as the environment. The company also has to fulfil its tax obligations accordingly as dictated by New Zealand's government policies.
Economic factors
All organizations within the New Zealand fast food industry are never affected by the national and global economic conditions. The fluctuations of the foreign exchange levels affect the operations of Sanitorium due to its reliance on imported raw materials. The global economic downturn also affects the profitability of the company since it relies on both imports and exports.
Socio-Cultural Factors
The socio-economic factors that affect the operations of Sanitorium include the emerging trend of healthy…
