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Charles Chocolates Case Solution & Answer

Charles Chocolates Case Solution

Introduction

Charles Chocolates is the most famous chocolate company in Portland. It is a private limited company. Steve now wanted to grow the business in the coming 10 years. The company provides premium chocolates to the customers through wholesale as well as in retail form. Online purchase for chocolates was also available(Zietsma, 2013). As a consultant I initially recommended the company that they should works on lowering the costing, develop strong research and development centre, expand the products and also update the packaging of products.

Analysis of Current Situation

External Environment

Inan external environment we take the macro environment for analysing the current situation which includes porters five forces model and pest analysis.

Porter Five Forces Model

Rivalry Among Existing Competitors

The chocolate market is established. So, there is high rivalry in the competitive industry. In the industry of chocolates, the leadership of strong aggression can create high pressure of competition for Charles Chocolates Company. The exit barriers are very low.

THE THREAT OF NEW ENTRANTS

The barrier for new entrants is very low so they can easily enter the industry by analysing the demand for chocolates in the market. New entrance barriers are high in the market because they required heavy supply and channels of distribution, heavy investments. The Threats of new Entrants can be reduced by limiting the networks of supply. By making a strong customer base the threat can be reduced because existing customers are satisfied by Charles products.

THE THREAT OF SUBSTITUTES PRODUCT

There are many substitutes available in the market of the chocolate industry. The threat of substitute is high because the various brand is already offering a high quality of products to the current customers. This threat is a major threat for Charles because the market of chocolate is full of variety and people always wants to try new thing.

BARGAINING POWER OF SUPPLIERS

The power of suppliers is high because there are some suppliers of this chocolate industry, so, the cost of switching is high. There are no available alternative suppliers of this industry. Manufacturing is impacted due to some suppliers being late in delivery. The demand is high and supply becomes low then the situation of shortage is faced by the company in most cases.

BARGAINING POWER OF BUYERS

This is low because the cost of switching is high. The buyers may not supply their crude materials since it is in West Africa and the plant is in Portland. So, there is no alternative available. A standard that is not effectively achieved by buyers. As forthe strongest power of bargaining, the market becomes more competitive and the rate of profitability becomes low.

Pest Analysis

POLITICAL FACTORS:

As Charles Chocolate Company is working in different countries so every country has its political issues which show a direct impact on the company’s business that’s why Charles Chocolate Company may lose the opportunity to grow in different countries because political factors affect the company.

ECONOMIC FACTORS:

As Economical changes come the Charles Company takes benefit from this changing economy. A lot of opportunities generates for the company as the economy grows which directly develops the business. Some variables can be given a lotof benefit to the company as growth in GDP, high rate of employment, and high-interest rates will boost the profit of Charles Chocolate Company.

SOCIAL FACTORS:

Social factors which directly impacted Charles Company are the role of gender, power distance, Inequality in society, and class distribution these are all things that socially affected Charles Company.

TECHNOLOGICAL FACTORS:

The culture and environment of the organization are completely dependent upon technology and the Charles Company’s advance in technology always believes in current trends and innovation. Charles Company uses modern marketing strategies, the social media platform to increase awareness of people towards their company. Charles invests in a research and development program for understanding the value chain.

LEGAL FACTORS:

the legal factors also affect the company because this is a food Produce Company so according to that some laws are reliable for them to follow………………………

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