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The Analysis of the Numico Company - Report Example

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This report shows that the company can utilize its strengths in research and development to consolidate its position and to enhance its market presence. The company can pursue effective hedging policies to reduce the effect of the currency exchange risk…
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The Analysis of the Numico Company
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Download file to see previous pages Numico operated in a highly competitive environment. The company’s target market was placed between the food market and the pharmaceutical market. The company faced huge competition from big as well as small players. The major competitors in the food segment for toddlers were large corporations like Nestle and Danone. On the other hand, Numico faced competition from players like Ross Abbott, Bristol Meyers, and American Home. Nestle is the market leader in the baby food industry. The other market players in the baby food segment are DANONE, Hero, and Squibb.
Numico operates in baby foods and clinical nutrition segments. The company faces competition from small as well as large players. The competition is even more intense in the developed countries. The largest player in the baby foods segment is Nestle. Numico also faces competition from players like Bristol Meyers, Ross Abott, American Home, Hero, and Squibb. There is also some stiff competition from the private label brands that compete on the basis of low cost targeting the value for money based market segment. These companies often displayed wild behaviours regarding their products.
The increasing awareness of the people regarding their health requirements has led to the bolstering of the baby food industry. This factor is largely responsible for the reduction in the use of substitutes which are considered an unhealthier option. The world market is dominated by the US which has a 37 percent market share. Hence, substitutes have a relatively low power in the industry framework.
The setting up of this type of industry requires huge distribution costs. Moreover, the industry being in the health-related sector hence a strong brand name is also very important in order to restore customer confidence in the product. A company that aims to start business in this sector also requires a huge capital base for setting up production units. ...Download file to see next pagesRead More
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