Zweifel Chips: strategy and market analysis of a Swiss manufacturer

Zweifel Chips Switzerland

Browsing through the television channels, one can invariably be presented with at least one or two shows discussing the necessity of the modern day society to change its life style. While great emphasis is being placed on the protection of the natural environment, in the meaning of reducing personal consumption of the earth's natural resources or the reduction in activities that generate pollution, specialists also militate for changes to occur in terms of alimentation. The United States of America offers the most relevant explanation for this trend, with its increasing levels of obesity and diabetes, characteristic to all age categories.

The nutrition advices are generally organized onto two directions. The first promotes a healthier life style through the consumption of more fruit and vegetables, in the detriment of carbohydrates, mostly junk food. The second trend is that of selecting products of organic provenience -- this direction is currently less accessible to most global consumers, as it implies incremental costs. Given a situation in which more emphasis is being placed on the reduced consumption of junk food, a question is being posed relative to the state of the companies which manufacture such items. In order to respond to this question, it is best to directly look at the state of Zweifel Chips, a reputable chips manufacturer from Switzerland.

The report commences by presenting the company; it then focuses on the analysis of the market in which it operates, to eventually conduct an analysis of the organization's business strategy. It culminates with a section on concluding remarks.

2. Zweifel Chips Switzerland

Zweifel, with its formal name of Zweifel Pomy-Chips AG, is located at 20 Regensdorferstrasse in Zurich, the largest city in Switzerland. Under the North American Industry Classification System (NAICS), the operations undertaken by Zweifel are categorized as Other Snack Food Manufacturing. It must however be noted that aside the actual manufacturing, Zweifel is also in charge of the distribution of their products, meaning as such that they employ a complex logistics system. In order to ensure that both quality of the products as well as delivery speed and efficiency are increased, the company invested large sums of money into the latest technologies that reduce workloads, inventories and operational times and costs.

The company mainly produces potato chips, which are packed in different size bags. The variety of the chips is rather vast, including spices such as the extra common salt, the more interesting paprika or the exotic curry. The company entitles itself "Die Chips Experten," or the Expert of Chips. The Zweifel chips are extremely popular among the Swiss population, but have even created a positive impression on the foreign visitors, who purchase the chips from the Swiss airports, hotels, stores or other locations. Aside the chips however, Zweifel also produces and sells a wide variety of snacks, such as corn chips, cheese snacks or popcorn. Some of their most common products and brands include the Chipssorten, the Original Chips or the Bruschette Merranea.

The company has been present within the market for 5 decades, and throughout their existence, they managed to overcome countless challenges. Additionally, throughout their existence, the company has also strived to support the development of the local communities. A significant means in which this is being currently achieved is that of commodity purchases from the local manufacturers, in the detriment of the generally popular cheap imports (Website of Zweifel Pomy-Chips AG).

3. Market Analysis

The foods industry is extremely fragmented, meaning then that the possibility of new competition raising is fairly increased. Zweifel meets two kinds of competition. The first refers to actual product choice, in the meaning that the consumer has to decide what snacks to purchase -- pretzels, popcorn, chips, peanuts, nuts and so on. The second type of competition comes from the manufacturing organization. In terms of national competition, this is most fierce from the part of Bischofszell Nahrungsmittel AG. The major difference between the two companies is however given by the fact that Bischofszell specializes in several potato-based products, such as French fries and salads (Potato Pro), whereas Zweifel focuses on snacks.

Since Switzerland is intensifying its efforts to implement trade liberalization as well as promote it at a global level (Markheim and Dean, 2006), it was only natural for Zweifel to encounter competition from foreign chips manufacturers. Given this situation, the most popular brands that fight Zweifer for shelf space and customer attention are Chio Chips, Lays -- from PepsiCo -- or Pringles -- from P&G (Taquitos).

An interesting thing to mention about the market of chips manufactures is that their marketing strategies would generically center on the adolescents and the adults. The products would be promoted as central pieces of entertainment activities, such as film watching or parties. In more recent years however, chips manufacturers in Switzerland and around the globe focused on children as targets for their marketing campaigns. A direct means in which Zweifel has responded to this market movement has been that of attracting children towards the company's snacks by including toys inspired from the Ice Age movies.

Another feature which characterizes the entire foods industry is the larger tendency to focus on eco products. As a result of the incremental levels of obesity, cardio-vascular diseases or even the pollution our consumerist life styles generate upon the natural environment, the modern socio-cultural trend is that of consuming eco products (Goldberg, 2008). In order to respond to this market challenge, the Swiss chips manufacturer uses eco components in making their products. The chips are for instance made from potatoes, or corn, depending on the case, purchased from the local producers. The chips are deep fried in fresh sun flower oil and are spiced with natural spices.

Internal Weaknesses

The company's communications with the external environment are reduced; an outsider finds it rather challenging to retrieve relevant information on the company when their website does not reveal an English version and when the organization has not raised the interest of the international media

Zweifel only sells its products in Switzerland, and a few stores in France and Germany. This virtually translates into the fact that the organizational managers are over-prudential in keeping the business national, meaning that they are either scared of the challenge, either unaware of the company's capabilities; in either cases, they bring the company down

External Opportunities

Switzerland is a promoter of liberalized trade, meaning that Zweifel could be presented with incentives to export its products

The socio-cultural trends in the global environment would make the natural ingredients in the Zweifel chips popular with the international consumer

The growing forces of globalization would support the Swiss company in expanding its businesses

External Threats

The internationalized economic crisis reduces the purchasing power of both Swiss as well as global consumers

The international trend of a reduced consumption of junk food to better protect individuals' health could also materialize in a reduced demand for potato chips and other snacks

The competition in the foods sector is generally on the rise, with more and more companies striving to get a share of the billion dollar revenues

5. Conclusions

Swiss chips manufacturer Zweifel Pomy-Chips AG is the leader of the national industry, but has refused to become engaged in global operations. Given the superior quality of the company's products, as well as the proven quality of their staff members, the next step that should be taken is that of expansion within the global market. The lesson here is that a prudential approach to business operations will ensure revenue stability, but revenue growth stands more chances when risks are taken.

References:

Goldberg, M., 2008, Pollution Makes You (and Your Kids Fat): New Study, Eco Chick, http://eco-chick.com/2008/09/1285/pollution-make-you-fat-new-study / last accessed on November 24, 2009

Markheim, D., Dean, J.E., 2006, Free Trade with Switzerland: Time for Action, The Heritage Foundation, http://www.heritage.org/Research/tradeandeconomicfreedom/wm960.cfm last accessed on November 24, 2009

All Snack Manufacturers, Taquitos, http://www.taquitos.net/snacks.php?page_code=69 last accessed on November 24, 2009

Doubts Original Nature Chips, Ciao, http://www.ciao.de/Zweifel_Original_Nature_Chips__677871 last accessed on November 24, 2009

Manufacturers of Chips and Snacks, Potato Pro, http://www.potatopro.com/Lists/Companies/Chips%20and%20Snacks.aspx last accessed on November 24, 2009

Website of Zweifel Pomy-Chips AG, http://www.zweifel.ch last accessed on November 24, 2009