Ice-Fili, Russian ice cream company

In the early 1990s the ice cream diligence was assert regulated. It had artificial commercialize, where all intersection was sold notwithstanding broad over action in the fabrication. During transition from state governed to marketplace economy, the industry shrank rapidly and was unattractive mainly because of political and pecuniary turmoil. erst Russian economy reemerged from the crisis, in the late 2001, the industry stabilized. persistence forces started to play major part in its attractiveness and macro instruction factors did not overshadowed them anymore. From 2002 and on, the industry became attractive and firms were commensu govern to provide to a higher place average rate of returns. For any given raw material, firms had an pickax to choose from 3-4 suppliers. They had chew of new offers from potential suppliers. However, suppliers could dictate seasonal worker wrong fluctuations of some materials. Additionally, the new domestic suppliers of production equipment were emerging. It resulted in trim back power of foreign equipment suppliers. Even though barriers to entry were shut up high (e.g. capital investment was high (1-1.5 million per production line); access to distribution channel was limited), high margins attracted new entrants. The market almost tripled from 1996 to 2002. The substitutes (e.g. beers, sodas, candies) stole significant market share from the industry, because these firms had plenteous advertisement budgets. They were able to change consumers buying habits.

Consumers did not dumbfound any switching costs, but it did not translated into h igher negociate power. The competition in t! he industry was growing, but there was relieve lot of growth opportunities. In comparison with foreign countries, the expenditure of ice cream was very low and very seasonal. The firms should motivate products by focusing on family and restaurant business consumption. This append expand the overall industry market and reduce seasonality effects. At the same time it will lower storage costs, liquid production and distribution. If you want to get a full essay, order it on our website: OrderCustomPaper.com

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