Strategic Management Issues in Fonterra

Running head: STRATEGIC MANAGEMENT ISSUES IN FONTERRA
STRATEGIC MANAGEMENT ISSUES IN FONTERRA
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1STRATEGIC MANAGEMENT ISSUES IN FONTERRA
Table of Contents
Introduction......................................................................................................................................2
Industry Overview.......................................................................................................................2
Fonterra’s Journey since 2001.....................................................................................................3
Summary of Aims and Objectives...............................................................................................4
Key Issues....................................................................................................................................4
Conclusion.......................................................................................................................................5
Bibliography....................................................................................................................................7

2STRATEGIC MANAGEMENT ISSUES IN FONTERRA
Introduction
Industry Overview
The report is aimed towards assessing the various factors that have recently affected the
Dairy industry of New Zealand. In order to critically assess the factors affecting the industry the
study is being made considering the case of the Fonterra. The company is one of the country’s
largest milk co-operatives. The dairy industry is one of the largest food based industrial sector of
the country and the world. New Zealand has almost 1.7 million hectares of land dedicated to
dairy production. With companies like Fonterra the industry is among the largest farm based
production industries in the country. Moreover, around 3% of the total dairy production in the
world is done by New Zealand. The country exports around 95% of its production of dairy
(Shadbolt & Duncan, 2014). The top international markets for New Zealand dairy are in Asia,
Australia and the United States. The top dairy products manufactured by the company are butter,
milk powder and cheese. Additionally, the dairy companies in the country specialize in
producing milk for infants.
Dairy is a substantially large sector considering the main business sectors of the country
(Nilsson & Rydberg, 2015). The climate of the country facilitates the better management of
cows. New Zealand maintains a healthy cow population that helps towards increasing the dairy
production of the country. The country has a relatively strong position when it comes to dairy
production both domestically and international. The cattle of the country is relatively free from
diseases as it is essentially an island nation (Havea et al., 2017). The industry of the country is
regulated by the Ministry of Primary industries. The major companies that dominate the dairy
industry of the country are Fonterra, Tatua, Westland Milk Products, Oceania, Dairy goat co-