Report On Dairy Industry Of Australia

Added on - 24 Feb 2020

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Running head: CASE STUDY ON THE DAIRY INDUSTRY OF AUSTRALIACASE STUDY ON THE DAIRY INDUSTRY OF AUSTRALIAName of the UniversityName of the StudentAuthor Note
1CASE STUDY ON THE DAIRY INDUSTRY OF AUSTRALIAExecutive summary:The purpose of the report is to present the current condition of the dairy industry of Australia.The case study of the cutting off the price for the purchasing of raw milk present the scenarioof the report. The Porter’s Five forces analysis and other numeric data has been presented toshow the authenticity of the report. The result shows the competitive disadvantages of thedairy companies and the farmers due to the crisis in the same industry.
2CASE STUDY ON THE DAIRY INDUSTRY OF AUSTRALIATable of ContentsIntroduction:...............................................................................................................................3The Background:........................................................................................................................3The Crisis:..................................................................................................................................4Porter’s Five Forces effect on Australian dairy Industry:..........................................................5Competitive rivalry within the industry:................................................................................6Bargaining power of suppliers:..............................................................................................6Bargaining power of the customer:........................................................................................6Threats of new entries:...........................................................................................................7Threats of substitutes:............................................................................................................7Numeric Table:...........................................................................................................................7Figure 1: Table of production cost versus selling cost...........................................................7Figure 2: Competitive position of Australian and international companies..........................8Competitive Advantages and Disadvantages of Australian Dairy Products:.............................8Conclusions:...............................................................................................................................9Reference:................................................................................................................................11
3CASE STUDY ON THE DAIRY INDUSTRY OF AUSTRALIAIntroduction:Business based on the dairy is one of the major and cost effective businesses inAustralia. A certain percentage of economy of Australia is determined by the sale of dairyproducts (Regulations 2013). The dairy industry of Australia has marked its place in thecompetitive market in terms of global perspective. Dairy production in Australia has alwaysbeen in the first position comparing to the other countries’ business in the same industry andcertain portion of the world economy is depended on it. There are many other internationalcompetitor companies that has been a threat to the dairy companies of Australia after thebeginning of the crisis. The dairy crisis of Australia has been making headlines for the newsover the last one year in the international context. The crisis of the dairy industry began fewyears back with the initiation of the globalization. The production of the dairy productsstarted to fall and in the last year. The production was the lowest comparing to the last twentyyears of dairy production. As the result of the crisis the competition with the internationalcompanies has been remarkably increased and impacting the dairy companies of the country.The Background:The background of the crisis shows the injustice to the farmers by the dairycompanies. It was in the end of April 2016, when one of the biggest milk processor ofAustralia, Murray Goulburn, reduces the price of the milk solids per kilogram, from $6 to $5(Adams 2016). The reduction of the production cost of the milk set the stage of the crisis inthe dairy industry in Australia. The whole incident suggests that he farmers had to face theloss as they were being paid less than their production cost (Becker 2017). In addition, thefarmers also had to pay back the differences, approximately $200 million between around2.500 farmers. There was no way the farmers could pay back the bills, But selling their cowsto the slaughters. It was only the beginning of May 2016 that around 700 dairy cows were in
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