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Operations Decision - Assignment Example

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All over the world, many people have turned to low calorie foods because they are usually thought to be healthier and more nutritious than those with high calorie. As a matter of fact, many people would prefer microwavable low calorie foods because of the ease of preparation,…
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Operations Decision
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Operations Decision

Download file to see previous pages... le is very common with those people with high incomes; that is, those who can afford to use microwaves as a substitute to the traditional cooking methods. Since the use of microwaves has become so popular, microwavable food products have become popular too. Some of the leading brands in microwavable low calorie foods, which will be analyzed in this paper, include Lean Cuisine and Healthy Choice. Lean Cuisine, which belongs to Nestle, was formed in 1998, and it is currently being sold in Canada, US, and Australia.  On the other hand, Healthy Choice is a leading low calorie food brand, which gives Lean Cuisine a run for its money. The brand is owned by ConAgra Foods, and its idea was generated in order to offer a line of healthier frozen foods in 1985 (Gregson 25).
     There are several factors that determine the effectiveness of low-calorie microwavable food industry’s market structure. The first one is the number of buyers and sellers. If there are few sellers of the commodities in the market, then the firms will have an ability to influence price of the commodities, but if the sellers are many, then they will lose the ability to have a great control over the prices. The second determinant is the nature of the commodity. In this case, if the microwavable food products produced by different suppliers are homogenous, then all the suppliers will be forced to sell it at the same price. However, if the food products are differentiated, then different producers may have different prices. Unfortunately, food products do not lack close substitutes, and hence the producers may not be able to charge higher prices on such a basis. Third, if there would be no restriction of entry and exit of firms, then it would be most suitable if prices are stabilized. On the other hand, if there is no freedom of entry and exit of firms, then the threat of competition will be minimal, hence the existing firms can practice a control over their prices. Fourth, knowledge of the ...Download file to see next pagesRead More
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