Business Strategy of Creamy Yoghurt: A Comprehensive Analysis

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Business Strategy

Table of Contents
Introduction......................................................................................................................................3
LO1 Analyze the impact and influence which the macro environment has on an organization.....4
LO2 Assess an organization’s internal environment and capabilities.............................................8
LO3 Evaluate and apply the outcomes of analysis using Porter’s five forces model....................11
LO4 Apply models, theories and concepts to assist with the understanding and interpretation of
strategic directions available to an organisation............................................................................15
Conclusion.....................................................................................................................................18
References......................................................................................................................................19

Introduction
Business strategy refers to the set of work that allows an organization to achieve its long term
objective. It is also a process that helps in identifying the mission, vision and objective of an
organization and enables to develop policies and plan in order to achieve these objectives. It is
the most important element of any organization as it develops a business plan and without a
business plan, no organization can successfully run their business (Verbeke, 2013). Here, I
choose creamy yoghurt to suggest strategic planning for them. Creamy yoghurt is one of the
majorly leading yoghurt manufacturing company in the UK. The main objective of this country
is to gain productivity and profitability by providing products in a more innovative way to
customers.
In this report, the mission, vision and objective of the company will be discussed, the external
and internal environment of the company that will show problems which, is faced by company
due to changing economic conditions. The report will also show how cream yoghurt use
PESTLE, SWOT, Porter five forces, value chain and gap analysis. This report will also show
how yoghurt can use different methods and theories to move in the new market.

LO1 Analyze the impact and influence which the macro environment
has on an organization.
Creamy yoghurt is one of the leading yoghurt manufacturing company in the UK. This
organization is currently holding a major market share that is considered as the second position
and aiming towards becoming a leading company in the manufacturing of yoghurt in the coming
years. The main objective of any organization is to develop and expand its business after a few
years of operations. To stand out from its competitors, cream yoghurt has determined some core
competencies that have supported them in this. Here the report will understand the mission,
vision and objectives of the creamy yoghurt and also analyze the macro environment of this
company.
Strategy refers to the scope and directions of an organization for a long period of time. This is
also considered a method or plan which helps in achieving organizational goal and solve the
problems by using available resources of the organization. Strategic planning refers to the
process that basically manages the resources of the organization to meet the objectives by taking
market opportunities into account.
Mission
Mission defines or states the purpose of the organization and used in every organization as it is
very important. Basically, this explains the main reason for the existence of the company. The
mission statement is very helpful for stakeholders as it gives an idea to everyone about the
intention of the company (Erkaya et al, 2012). The mission statement of creamy yoghurt is ‘offer
the best products to customers in a more innovative way than the competitors and give more
value to the customer while empowering the employees'.
Vision
Vision is the statement that shows organizational hopes and wants which need to be achieved in
future. Basically, vision shows what an organization wants to achieve in future in the long run
for maybe ten or fifteen years ahead. The vision of cream yoghurt is ‘to become a market leader
by adding creativity and innovation together as well as empowerment'
Objectives-

The organization should have its own objectives and goals before starting a business. It is very
essential for an organization to identify its objective and purpose in order to carry out the
business operations. So here are some objectives of creamy yoghurt-
 Profitability and productivity- the main objective of any organization is to gain
increased productivity and profit over time. One of the most common and important
objectives of creamy yoghurt is to maximize profit, they are hoping to maximize increase
their profit by 25% in the next two years (Powell and DiMaggio., 2012). To do so, the
management of this company is taking essential actions to enhance the productivity of
their labours by providing better environment training and necessary resources that are
helpful to achieve the objective.
 Employee retention and relation- this organization is the following method to achieve
its objective in an easier way that is to keep the employees motivated and happy. Both the
statements mission and vision depicts employee empowerment. What is needed in
creamy yoghurt is only building up good employee relations with other employees and
management in order to retain them? So their main objective is to retain the employees.
 Growth- growth is a vital objective of an organization. As the company is planning to
expand its operations in the upcoming years. Few important decision and plans need to be
implemented properly (Erkaya et al, 2012). The company is planning to introduce new
products or new branches in another country. So, the objective is to familiarize the brand
name with prospects.
 Customer relations and marketing- the objective of creamy yoghurt is to market their
product ineffective manner through appropriate delivery of messages to its customers.
Marketing is far more than creating advertisements, it is about understanding the buying
trend of consumer, developing the partnership in business and identifying product
distribution needs in order to improve market share. And keep consumers satisfied and
happy is the objective of this company.
 CSR- this company is highly involved in CSR activities as their objective is to make the
society and country healthy.
Macro environmental audit is undertaken by most of the organization to determine its
capabilities and strengths to face the outside world. Both the factors internal or external have a

greater impact on organizations decision, objective, goals and plans. So, it is very important to
understand these factors to scan the environment that can influence current and future plans. To
do so, a PESTLE analysis could be carried out.
Figure 1- PEST analysis
Source- EPM, 2018.
 Political/legal - this factors influence the decision making of an organization as it places
duties and obligations on the organization (Erkaya et al, 2012). Creamy yoghurt needs to
obey every market regulation as well as tariffs and trade agreement, tax policies, safety
regulations which are imposed by the government, etc.
 Economical- the market conditions keep on fluctuating as the economy changes from
time to time. The situation like the economy in recession, booming or inflation problem
that can affect the plans of the organization so, creamy yoghurt needs to cope up with this
situation by reacting properly on the economic conditions.

 Social- this factors basically undertake consumer’s behaviour and lifestyle. As the taste
and preference of every person differently. So the company must produce products that
can capture a wide range of customers (Powell and DiMaggio., 2012). This factor also
considers demographics and mood. So, yoghurt needs to produce those products which
are perfectly suited to different segments of the market.
 Technological- nowadays most of the organizations are using modern technologies to
manufacture their product so as, creamy yoghurt is doing. Because this technology helps
in exchanging information faster as well as to respond immediately to changes. Yoghurt
is using modern technology to get a competitive advantage. Internet shopping is highly
used by consumers these days to shop from home through mobile apps.

LO2 Assess an organization’s internal environment and capabilities
SWOT is a tool for strategic planning that helps the organization to identify its strengths and
weaknesses as well as threats and opportunities that exist in particular business conditions. A
SWOT analysis must be done before starting any businesses operations (Camisón and Villar-
López, 2014). So, let’s discuss the capabilities and internal environment of Creamy Yoghurt
through SWOT analysis.
Strengths-
 This company has a strong and unique name "CREAMY YOGHURTS" that have the
ability to entice the consumers.
 This organization is having well-experienced staff.
 This company use eye-catching and very attractive packaging that mainly helps in
attracting kids and a wide variety of consumers through the availability of a large
number of products in various Yoghurt flavours (Camisón and Villar-López, 2014).
 There innovative ideas like offering free gifts to kids through proper decision making to
take a competitive advantage as well as attracting more customers.
Weaknesses
 The products of Creamy Yoghurt have higher costs, which is the biggest weakness of this
company.
 This company needs to find some new ways to raise or obtain the funds for further
expansion.
 To compete effectively with its competitor's company needs to invest in new technology
to get the advantage.
Opportunities
 The company has the opportunity to expand its business in other areas of the UK.
 This company has the opportunity to integrate or collaborate with small firms like a juice
bar or snacks.
 Nowadays, advancement in technology and machinery is growing at a faster pace which
helps in making the production more efficient and faster.

 This company has the ability to capture larger market share as to get higher consumer
base as this company is targeting all the high income, middle income and low-income
group of people (Green Jr et al, 2012).
 It has the opportunity to have arrangements with juice and snacks with the supply of
yoghurts.
 There are possibilities to take over or merge with a small company that may help them to
achieve their main objective that is to become an organization holding the highest market
share.
Threats
 The major threat to this competition is the availability of high competition in the market.
 The constant change in taste and preferences of customers.
 Various policies and legislation enforced by the government often hinders the business
(Green Jr et al, 2012).
In my opinion, The organizational internal capabilities and skill set that shows strengths and
weaknesses of Creamy Yoghurt so, to analyze this core competency of the organization needs to
be identified that makes this company strong over its competitors. Core competency helps in
determining the things which the company do better than its rivals. And Creamy Yoghurts has
many advantages and strengths over its competitors such as-
o Company has very experienced staff since the company is having the people who are
working all most from the beginning of the company so, they all are very well
familiarized with the business environment of Creamy Yoghurt.
o Creamy Yoghurt is a company that gives many opportunities to the people who are
young, innovative and creative people. Through this, the company is able to earn a good
name in society as it is giving higher job opportunities to the people.
o As mentioned above that Creamy Yoghurt is highly involved in CSR activities that
basically helping the people or children's of rural areas. And this factors is majorly
adding benefit to the company over its competitors and also improving the brand image
of the company.

o This company is mainly named to providing good satisfaction to their customers through
their products and services (IşıK, 2013). And this leads customers to leave happily their
outlets of Yoghurts every time they visit Creamy Yoghurts.
o Another strength of this company is that it is currently having the second largest market
share in the country and now wishing to reach on top within the next two years.

LO3 Evaluate and apply the outcomes of analysis using Porter’s five
forces model
Porter five force model is a simple tool to evaluate the competitive forces of the market for an
organization but this tool is very useful to understand where power lies in a business situation.
This model is useful because it provides understanding about both the position the strength
where current competitive position lies and the strength of that position which you are
considering to move in future. As it provides a clear understanding about the where power lies
the organization can take full advantage of that situation and strength by improving the weak
situation in order to avoid taking wrong steps (Camisón and Villar-López, 2014). This step or
analysis has an important place in the planning process of any organization. This model basically
helps in identifying the potential areas of the business to achieve profit through new products and
services. This below diagram is explaining the porter five forces.

Figure 2- Porter five force Model
Source- Cornerstone, 2019
The threat of new entrants- the threat of new entrants is very high in the market due to low
barriers to entry and low startup costs. Whereas, the country is providing many training and tools
that are required for a startup are easily available, which is making very easier for new entrants
to establish their business in the market (Indiats et al, 2014). Thus, Creamy yoghurt is facing a
high threat of new entrants in the market.
Bargaining power of suppliers- market is consisting of a large number of suppliers that means
there are many distributors in the market. So, this large quantity of suppliers has made low
bargaining power among the suppliers. The prices get adjusted according to the desire and
depends on the product quality. Since many suppliers are available who offers similar products
so, the Creamy Yoghurt has the ability to have high bargaining power.
Industry rivalry- the rivalry is very high in the company who are offering yoghurts and also
there many an immense number of competitors who are having low switching costs. As these
companies are selling commodity product so they mainly focus on experience and customization
instead of prices. Presently, there are more than 800 shops that are offering yoghurts in the UK.
So the price is not the differentiation strategy as many users pay based on weight structure.
Creamy Yoghurt is conducting loyalty programs in which they offer a large number or a wide
range of customization and toppings in order to gain repeat customers by providing a relaxed and
comfortable environment so that customer can enjoy. Thus, Creamy Yoghurt is facing high
rivalry in the market.
Bargaining power of customers- market is providing many alternatives to customers so,
customers are having high bargaining power. Although, people are now opting healthier options
than ice creams and other things as yoghurt are much healthier in terms of sweet but the price of
these products clearly differentiate. In a recent study, it has been shown that 79 per cent of
customers prefers Creamy and other flavoured Yoghurts in comparison to regular ice cream
(Indiats et al, 2014). Instead of healthier options, customers have high bargaining power and