Detailed Analysis of the Food Processing Business Sector: ABF Report

This report provides a comprehensive investigation into the food processing business sector, with a specific focus on Associated British Foods (ABF). The analysis begins with an overview of the business and its competitive landscape, followed by a detailed competitor analysis. The report applies Porter's Five Forces model to assess the industry's competitive dynamics, examining the bargaining power of suppliers and buyers, the threats of substitute products and new entrants, and the rivalry among existing firms. Furthermore, the report delves into the human resource management practices within ABF, highlighting the importance of a strong internal environment, recruitment processes, employee motivation, and engagement. Recommendations are provided for future strategies, emphasizing the need for innovation, effective leadership, and a focus on the internal environment to ensure continued competitive advantage and long-term success in the market. The report concludes with a summary of key findings and insights into ABF's position within the food processing sector.

Investigation into business
sector

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
Competitor Analysis....................................................................................................................3
Porter Five force model...............................................................................................................4
Human resource management......................................................................................................6
Recommendation.........................................................................................................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Business refers as a company where people works together to manufacture and sells
goods and services. In other word, the organization that engages in commercial, industrial
activities and builds brand image in global market. There is various type of business sectors such
as retailer, manufactures, food processor and others. The main goal of the business to gain
competitive advantage in the competition market and leads sustainability in their practices.
There is an example of Associated British Foods plc which helps to understand role of
competitors in the same business sectors. It is British Multinational food processing and retailer
company. It is headquartered in London, UK. The brief study analysis competition in food
processing market.
Competitor Analysis
Associated British Food plc is MNC companies which is famed for it’s products and
services. Organization has two subsidiaries British Sugar and Primark which offers variety in
products and services. The organization famous in the world as largest producer because it
produces sugar and baker’s yeast and manufacturer of other ingredients includes emulsifier,
enzymes and lactose. Competitors are Berlin Natural Bakery, Alpine Valley Bread, Alvarado
Street Bakery and others are main competitors of the organization because they have large
market share as same Associated British Food (Benn and Rusinko, 2017). Competitors operates
in same field in which organization activates. But organization has good global presence as
compared competitors. Organization has good positioning in the business which helps to gain
competitive advantage. There are several examples which helps to understand reason of
positioning and competitive advantage of Associated British Food such as organization uses
multiple suppliers’ strategy which helps them to get high quality raw material at low cost from
different location. It causes organization does not have to pay high operational cost as result cost
of product decreases which becomes easy to attract large number of customers. While other
competitors such as Berlin Natural Bakery gets inputs on high cost that causes operation cost
become high. It is the main reason which causes organization becomes market leader.
Organization follows media campaign which supports to sell it’s products in other countries and
generates profit margin on products by offering low cost. Product differentiation strategy follows
by organization which is quite expensive strategy. the strategy helps company to create variety in

each product which influences purchasing behaviour of customers. This strategy put pressure on
competitors as well because most of the customer switch the firm and starts to buy products from
the Associated British Food. These are the reason which helps company to gain high brand
positioning in their sector. Porter’s five force model follows by organization to analyse it’s
competitors such as Berlin and Alpine who offers same products like ingredients and foods and
has large market share in the business market. Porter five force model helps company to
determine competitor’s weakness and supports to gain competitive advantage from them
(Brewster and et.al., 2016). Cost focus strategy follows by organization which helps company to
become market leader and builds customer trust on the brand. It also assists company to gain
competitive advantage.
Porter Five force model
Porter’s five forces refers as a strategic framework that determines and examine five
competitive forces which gives shape to each organization or industry and supports to identify
weaknesses and strength (Esbelin Santos and Hébraud, 2018). Five forces analysis helps
organization to determine corporate strategy that supports to lead competitive advantage within
business. The model is specially designed to analyse competition and gains competitive
advantage from the competitor in the business market. the model is described below:
Bargaining power of suppliers (Low)
Associates British Food operates in the London, UK where supplier power is too low as
compared buyers. It indicates that there have large number of suppliers who does not have
control on cost that’s why their bargaining power is too weak. It is golden opportunity for the
organization because they do not have to pay high cost. Even they can recruit highly skilled
suppliers in place of non-compatible suppliers (Ulubeyli, 2017). Associated British Airway
keeps those suppliers within company who gives best services at workplace by offering good
quality product in minimum time. when company does not happy with cost and product then
switch suppliers to access good supplier. Organization have multiple suppliers from numerous
locations which helps company to get raw material on low cost. low cost product reduces
operational cost which helps company to sell products on low cost to the customer and gains
competitive advantage in the business market.

Bargaining power of buyers (Low)
Bargaining power of buyers is low in the food processing industries because fewer
companies produces ingredients and other products. So, customer have very few options to
switch firm. While Associated British food is one of the most famous company who produces
products and have variety of food products (Fam and et.al., 2019). Generally, product
differentiation within food processing industry is too high that creates difficulty for the buyer to
switch another firm. It denotes that buyer’s bargaining power is highly wakened in the business
market. organization gets positive impact of this weakness because they easy to sell large
number of products to customer on optimum price because operation cost is too low as result
gets competitive advantage from the competitors (Associated British Foods Plc Porter Five
Forces Analysis, 2019.).
Threats of substitute products (Low)
Threats of substitute products is weak in the UK market because to produce substitute
products are quite expensive process. There are few substitute products available in the food
processing industries because operational cost is too high and income level of buyers are low as
result, they cannot buy expensive products (Geand Li, 2019). Associated British Airway also
operates in the sector which has few product differentiations. But organization focus on product
quality and customer preferences which helps them to meet their objectives and in return
generate high profit margin on products.
Rivalry among existing firms (Low)
Organization have to face competition in the food processing industries because there are
several competitors i.e. Hovis, Alvarado Street Bakery and Berlin Natural Bakery which operates
in the same business sector and offers same product services to the customer. In addition, they
have large market share as same Associated British Food. The major advantage is this number of
competitors are fewer because other competitors does not have large market share. It denotes
rivalry among existing firms are weaker within food processing industry. So, it become easy for
the Associated British Food plc to engage in competitive action. It supports to gain competitive
positioning and become market leader in the UK market (Zhang, Leng and Zhou, 2020). there is
other reason which cause rivalry force is weak such as most of the competitors which good

quality products but they unable to sell on high price because buyers’ income is too low as result
cannot achieve larger market share that makes them weaken in the food processing industries.
Threats of new entrants (Low)
Threats of new entrant is weak in the sector in which Associated British Food operates
because business requires high investment along with product portfolio. Organization has large
market share and has strong brand value in the business market which puts pressure on the
competitors (Magalhães and et.al., 2019). In addition, organization offer high quality products at
low cost to customer as compared other competitors which helps organization to achieve
competitive advantage. It can be interpreted that it become tough competition for the new entrant
to sustain in the market because business requires more funds to run in the market. In any case if
a new entrant establishes it’s business in this sector then initially they have to build strong base
of customers by offering low cost products then can enable to compete with competitors. In
addition, new entrants have to capture large market share to compete with Associated British
Food. As know it is not possible to offer products at low cost because operational cost is too
high. If a new entrant sells its products at low cost then must have good financial performance
and strategies which avoids loss within company. That’s why threats of new entrant forces are
very weak in the food processing industry.
Human resource management
There has to be an open environment in the organization so that the productivity in the
organization can improve which is going to make the functioning and the objectives of the
organization be met easily. It is very important for the organization to achieve their objectives
form time to time so that they can get a competitive advantage. The human resource has to make
sure that the right skilled and trained employees are coming in the organization so that they can
have a better functioning which is a very essential factor for them (Fam and et.al., 2019). British
food has a lot of competitors in the market which is why having a strong internal environment is
a very important factor for the organization because that can give the organization a lot of
competitive advantage for a long run in the market. There are a lot of innovations and ideas
which are generating in British foods which is a very important factor because that can help the
organization to satisfy the customers even more which is important. Human resource makes sure
that they are providing what are basic needs of the employees of the organization and the

conflicts in the organization are being resolved on time so that the team work in the organization
is not harmed.
The team has to work as one which is why the human resource acts as a bridge between
the management of the organization and the employees of the organization so that there is no
miscommunication in the organization which is a very essential factor for the organization. There
is a very strict recruitment process which is followed in the organization so that there is a better
workforce which can be added in the company (Benn and Rusinko, 2017). Motivation is
provided to the employees of the organization from time to time so that they can have a better
functioning which is a very essential factor for the company to have a better market share for
themselves. Engagement of the employees is being well maintained in the organization and the
quality of the products of British food is not being compromised upon from years so that the
organization can have a good reputation in market which is essential. The language in the
organization has never been a problem for the organization which is a great factor for the
company and the satisfaction of the employees in the organization is also good. There are a lot of
improvements which the organization has done in the past so that they can have a better
functioning and the organization can have a better customer base (Sparrow, Brewster and Chung,
2016).
Recommendation
In the coming years the organization will have to get more employees in the organization
who can get in new and innovative ideas which is going to be very good for a long run of the
organization. The human resource of the organization will have to understand there
responsibilities and roles in the organization so that they can have a better functioning. It is very
important for the human resource for not just focus on the employees but also analyse the
internal environment so that they can make decisions for the future of the organization which is
going to help the organization to have a better operations. There have to be good styles of
leadership which has to be used by the human resource so that they can understand the
employees and make changes in the organization accordingly which is going to be very helpful
for a long run of the organization in the market (Magalhães and et.al., 2019). Human resource is
going to have a dedicated team in the next 2 to 5 years of British food so that the organization
can have a better competitive advantage in the market because there is a huge growth in the

market of competitors. It is because of the motivation there are ideas and new recipes which are
coming out with British foods which is a great competitive advantage which is going to improve
more when the human resource management improves their rewards and appreciation for the
employees of the company so that the functioning of the organization can be better. Changes are
going to come in the company regarding technological factors and other which the human
resource has to make sure that there is adapting of those changes in the organization so that there
is a better functioning.
CONCLUSION
The brief study provided understanding about company like organization followed
different strategies such as product differentiation, multiple suppliers, media channel and others
which helped company to gain high brand positioning and low-cost strategy supported to gain
competitive advantage in it’s sector. Porter Five force mode has been concluded in report.
Significance of HRM within organization can be summarized in report.

REFERENCES
Books and Journals
Benn, S. and Rusinko, C.A., 2017. Boundary objects, HRM tools and change for sustainability.
In The Necessary Transition (pp. 154-170). Routledge.
Brewster, C and et.al., 2016. International human resource management. Kogan Page
Publishers.
Esbelin, J., Santos, T. and Hébraud, M., 2018. Desiccation: an environmental and food industry
stress that bacteria commonly face. Food microbiology. 69. pp.82-88.
Fam, K.S and et.al., 2019. Touring destination and intention to consume indigenous food. British
Food Journal.
Ge, L. and Li, C., 2019, April. Analysis of competitive Power of Chinese Sports Apparel Brand
based on Porter's five Force Model. In Proceedings of the 2019 3rd International
Conference on Information System and Data Mining (pp. 54-58).
Magalhães, A.E.V and et.al., 2019. Food traceability technologies and foodborne outbreak
occurrences. British Food Journal.
Sparrow, P., Brewster, C. and Chung, C., 2016. Globalizing human resource management.
Routledge.
Ulubeyli, S., 2017. Industry-wide competitiveness assessment through fuzzy synthetic
evaluation: the case of cement industry. Journal of Business Economics and
Management. 18(1). pp.35-53.
Zhang, C., Leng, M. and Zhou, L., 2020. DEVELOPING STRATEGIES OF SOCIAL
ENTERPRISES EXPLAINED USING PORTER'S FIVE FORCES ANALYSIS
MODEL: TAKING MENTAL CHALLENGED CAR WASH AS AN
EXAMPLE. International Journal of Organizational Innovation. 12(3).
Online
Associated British Foods Plc Porter Five Forces Analysis. 2019. [Online]. Available Through:-
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