Sustainability of Bega Cheese’s current strategy

This article discusses the sustainability of Bega Cheese’s current business strategies, including continuous improvement, selling products under another brand, and entering a new market. It also highlights the challenges the organization may face, such as strategy copying, competition, and logistic costs.

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Bega cheese
Sustainable Business Planning & Strategy
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SUSTAINABLE BUSINESS PLANNING & STRATEGY 1
Sustainability of Bega Cheese’s current strategy
At the present Bega Cheese organization has mainly focused on three business strategies.
The first strategy is focused on continuous improvement, second is focus on selling product
under other brand and third is focus on new product line. All this strategy seems to be very
significant for the growth and development of the Bega cheese organization in their specific
terms. Present business is operating on dynamic mode and there are always chances of
uncertainty in the business operation. In this situation, continuous improvement plays a very
significant role by motivating Bega Cheese organization to keep on adopting a small change in
order to enhance their operation, especially in technology (Afraccess, 2018). At present
innovation in technology help organization in gaining a competitive advantage over other
organization which is operating in the same market. In addition, this strategy will not only help
this organization to remain sustainable in present but will also help them to maintain their
sustainability in the near future by adopting their Kaizen Technology also known as continuous
improvement. This strategy is able to provide two types of main benefit to Bega Cheese
organization, one is cost cutting and other is offering what customer has been expecting from
years which help in forming strong customer base for this organization (Oliver, 2009). In
business environment having strong customer base is considered a key feature for sustainable
growth.
Another strategy is, selling products under another brand with same name. This strategy
of Bega Cheese is able to offer present sustainability status to this organization in present market
because, it is actually helping the organization to reduce cost related to cutting, processing, and
packaging on which usually company has to invest good amount. On financial aspect, this
organization is performing well with the help of this strategy but at the same time, this strategy is
not going to work for longer time because this strategy is not able to create value to the Bega
Cheese product in the market (Besharat, 2010). This is because the organization is selling their
product under another brand which in future will display a perception in the minds of potential
customers that product of Bega Cheese which is selling under Fonterra brand is actually their
subsidiary product line and not the product of Bega Cheese company. There are many chances
that even after becoming a loyal customer to Bega product the customer will still become part of
Fonterra brand group (Helfat & Winter, 2011). This strategy is actually offering unintentional

SUSTAINABLE BUSINESS PLANNING & STRATEGY 2
marketing for Fonterra brand which can present a possible threat to the position of this
organization in the business market in the near future.
Third strategy of Bega Cheese is entering into completely new market. This strategy is
surely going to offer a big competitive advantage in the present as well as in future because as
this market is new so there will be fewer players operating in this new product line market
(Parry, Song, De Weerd‐Nederhof & Visscher, 2009). Therefore it is offering a great opportunity
to Bega Cheese organization to fully explore this market with the help of their previous
experiences and capture the major share of the market which can offer them a good percentage of
profit margin. Profit margin is also considered as one of the prime factors for sustainable growth.
In addition, this strategy will help this organization to create a big web of their competency over
this new product line market by which they can create an entrance barrier for the new entries in
terms of technology, unique approach as well as financial capital. This strategy will ensure the
sustainability of this organization for the near future.
Main sustainable challenges for Bega Cheese organization
One of the biggest challenges which this Bega Cheese organization is going to face in the
coming five years is copying of these strategies. The strategy which this company/organization is
currently using is not very unique and hence it will not help the organization to stop other
companies to copy these strategies (Szulanski & Jensen, 2008). No doubt, the new companies
have to put a lot of effort to enter into the market but once it has gained access to the market,
then it will be just matter of few months to establish almost similar kind of strategy in their
business model. This will display a threat like the business environment around this organization.
Another big sustainable challenge for Bega Cheese organization is their second strategy itself
because it is not advisable to use this strategy for long terms even though it is offering cost-
cutting benefits. This strategy is actually building a strong challenge of the reputation for this
organization by unintentionally offering marketing benefits to other organization by serving their
high-quality products in the market under the name of another brand (Camillus, 2008). This will
offer a big challenge of competition within their home market.
Another big issue for Bega Cheese organization is Dairy business is considered as one of
the profitable business on the global level and therefore it is attracting companies from all over

SUSTAINABLE BUSINESS PLANNING & STRATEGY 3
the world. This has increased the competition within the dairy market due to the entry of both
domestic as well as international market and therefore in near future, there are maximum chances
that the profit margin enjoyed by Bega Cheese organization at present situation will be no longer
available in upcoming five years (Dervillé & Allaire, 2014). More number of competitors means
more number of profit sharing and it is the profit share which actually decides the position of the
organization in the business market.
Another challenge for Bega Cheese organization will be logistic cost, due to dynamic
business environment, it has become very difficult for the organization to forecast exactly the
cost associated with the logistics and supply chain system especially in dairy industries. Prices
related to transportation are varying day by day and therefore it not easy to predict the future
logistic and supply chain cost (Glover, Champion, Daniels & Dainty, 2014). Dairy business is
totally dependent on the logistics and supply chain system and in fact, its third portion of costing
is linked with this system. Therefore it has a direct impact on the growth and development of
Bega Cheese organization in order to capture the major share of the Dairy market.
Recommendation
CSR, also known as corporate social responsibility is considered one of the most
important activities for sustainable growth of any organization which is associated with self-
regulation model to assist organization towards their social responsibility. It includes all the
stakeholders along with the local community. CSR activities will help Bega Cheese organization
to maintain its focus on triple bottom strategy economic, environment and social aspects of the
world. This concept will help this organization to focus its strategy on all the important aspects
which will offer sustainability growth to this organization (Blombäck & Wigren, 2009). In
addition, involving CSR activities in the organization will offer an image that this organization
care for the community and therefore are working for solving issues related to the community.
This will offer an emotional platform to this organization on which they can form a strong
relationship with their potential customers which will ensure their stability. As per the study, it
has been seen that at present business is mainly operating on those aspects which can enhance
the life of a common person by eliminating negative aspects in their life such as moving towards
organic products as compared to non-organic products (Tuorila & Monteleone, 2009). This taste
chance is offering a great opportunity to this organization to introduce their organic product line

SUSTAINABLE BUSINESS PLANNING & STRATEGY 4
in the market which will not only help the organization to capture the organic demand market but
will also help in creating unique image in the minds of the potential customer that Bega Cheese
organization is offering healthy food products in the market which is displaying their care for the
people living in the community in which they are functioning.
According to Friedman managers are the representatives of the shareholder and are
responsible for their every action but it is not their duty their duty to focus on social interest
because if the manager utilize the resources which are associated with the company for social
interest, then the management has to sustain two types of loss either they have to compromise
with their profit share or they have to increase the price of their product which can dissatisfy
their customers. Currently, Bega Cheese organization is working on this phenomena but the
management of the organization must not forget that every single person associated with the
organization is actually part of the community and therefore every single action of the
organization is somewhere connected with their own employees’ development.
In addition, this organization must adopt a real-time strategy under which the
organization will be able to study the changing demand and preference of the customer along
with their purchasing behaviour. This will help the organization in introducing those products
which can stand on the exact expectation of the customer and can easily position their image in
the minds of the potential customers (Delmas, Fischlein & Asensio, 2013). Also, the Bega
Cheese organization must adopt some unique strategy like Dell Company which will not be easy
for other organization to copy because either the company has to give up their current suppliers
or they have to invest huge capital on their research and development department. This will
surely offer an upper hand in this world of the competitive business market.

SUSTAINABLE BUSINESS PLANNING & STRATEGY 5
References
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