logo

BUSM3200 - Strategic Management in the Global Market

   

Added on  2020-03-04

23 Pages3476 Words43 Views
Running head: STRATEGIC MANAGEMENTStrategic ManagementName of the studentName of the universityAuthor Note:

2STRATEGIC MANAGEMENTExecutive SummaryThe following report has aimed to discuss on the recent crisis faced by the Dairy Industry ofAustralia and its competitiveness in the global market. The 3rd largest dairy product exporter ofthe world has been facing some serious crisis regarding milk production. The researcher hascompleted a detailed analysis on the following and have discussed on it. He has carried out astrategic analysis of the subject and has also completed a quantitative research by providingsome key statistics and figures related to the Australian Dairy industry.

3STRATEGIC MANAGEMENTTable of ContentsIntroduction......................................................................................................................................5Competitive Environment................................................................................................................5Domestic and International Markets Modes of Entry......................................................................7Value Chain Model..........................................................................................................................7Figure No 1- Value Chain Model of Australian Dairy Industry......................................................8Strategic Landscape.........................................................................................................................8Porter’s Five Forces.........................................................................................................................8Figure No 2- Porter’s Five Forces Model........................................................................................8Competitive Advantage.................................................................................................................10Quantitative Analysis.....................................................................................................................12Table No 1- Key Statistics of Australian Dairy Industry..............................................................12Figure No 3- Export of Dairy Products.........................................................................................13Figure No 4- Dairy Analysis of Australia......................................................................................13Figure No 5- Snapshot of Australian Dairy Industry.....................................................................14Table No 2- Market Concentration of Australian Dairy Industry.................................................15Figure No 6- World’s Leading Dairy Products Exporters.............................................................16Figure No 7– Total area of Dairy Farming in Australia................................................................16Figure No 8- Tonnes of Milk Produced per country by per cow...................................................17

4STRATEGIC MANAGEMENTFigure No 9-Producer Support Estimates in Different Countries..................................................18Figure No 10- Comparison of Australian Dairy Farming.............................................................18Figure No 11- Return on sales of Dairy Products..........................................................................19Conclusion.....................................................................................................................................19Appendix........................................................................................................................................23

5STRATEGIC MANAGEMENTIntroductionThe Australian Dairy industry is a 3.4billionAUD industry based on the amount ofproduction and sales. It is supposed to be one of the largest rural industries of Australia. Itemploys more than 40,000 people directly and indirectly. The industry is also one of the biggestin terms of downstream processing. Significant economic development of rural Australia hasbeen possible just because of the Diary industry. Australia accounts for just 2% of the globalmilk production but it has improved notably in the production of quality dairy products and inturn has become one of the world’s significant exporters of dairy products. The island continentoccupies the third position in terms of dairy export. The dairy products of Australia are mainlyexported to the different countries of Asia like Japan, Singapore, Indonesia and the Philippines’The concentration of the Exports of Australia in and around East Asia and the surrounding placesof Indian ocean helps the country to carry out smooth trade and assert their supremacy in theseareas. The main products that are manufactured by the Australian dairy industry include cheese,butter, milk powders as well as fresh drinking milk. The major dairy producing centres arelocated at the rural area of the country.Competitive EnvironmentThe Australian Dairy Farming industry is in a state of serious crisis. The industry issuffering mainly due to the cheap rate of other similar products in the market as well asfluctuations in the amount of cost in both the local and international markets. The presence oflarge scale global competitors is posing a serious challenge to the growth of the country’s dairyindustry (Seale et al. 2015). The dairy farmers are finding it tough to adjust in the presentsituations. The milk production is on a 21 year low and farmers are expected to produce 700

6STRATEGIC MANAGEMENTmillion liters fewer milk in the current financial year. Such an immense shortfall in the milkproduction will surely have adverse effects on the sustainability of the industry. The rapid fall inthe production will lead to a sharp fall in the exports of the country. The production has beenestimated at around 8.8 billion liters. The major causes of such a situation is the sudden pricedrop by major dairy processors Fonterra and Murray Goulburn, wet weather conditions in winterseason are some of the common reasons behind such a crisis (Klerkx and Nettle 2013). Dairy Australia senior analyst Mr. John Droppert stated that the most affected region ofsuch a crisis was Northern Victoria. The part of Australia which accounts for a huge productionhas been facing a negative downslide of around 18% of the total volume of milk (Byrne et al.2016). The production of less milk will be surely hurting the cause of other dairy products. Theproducers have been failing to meet the market demand for the products and thus are staring at ablank future. Another serious concern for the dairy industry is the pressure on the dairy breeds toperform more so as to meet the demands of the industry. Dairy cows are subjected to continuousimpregnation, calves induction and milking. This process takes a serious toll on the health of thecows and has been seriously diminishing the amount of milk production on an average. The firmowners also practice tail docking and remove the horns of the animals which is seriouslyreducing the lifespan of these high breed animals (Douphrate et al. 2013). The average lifespanof these animals have become six to seven years while their original lifespan is around 20 to 25years. Such unscientific practices by the dairy farms have added up to the crisis as the milkproduction has reached the lowest levels.

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
BUSM3200 - Australian Dairy Industry - Management Strategy
|12
|3415
|114

104803M - Australian Dairy Industry analysis - Case Study
|20
|3321
|40

1003MKT - Dairy Industry in Australia
|8
|1317
|126

Supply Chain Design of Australian Dairy Industry
|11
|1237
|179

The Australian Dairy Industry : Assignment
|11
|2164
|72

MKG721 - Food Marketing | Australian Dairy Industry
|10
|1620
|42