A Study of Management

Question: What is the Management ? Answer: Introduction: The company that focus on and manufacture baked goods that consists of food items like cakes, cookies, crackers and pastries, if to name a few is considered as the bakery industry. Frozen bakery products include frozen breads, frozen pizza crust, frozen pastries and other bakery products (Therkelsenet al. 2014). With the development and improvement in different types of machines and the availability of various additives, it has become possible to manufacture various types of bakery food items. Today, many companies are focusing on the bakery and frozen bakery products to enhance their food market (Kenijz and Sokol 2013). Moreover, with the increasing demand of these frozen bakery products, this industry has been found to enhance largely. The market has been growing towards more sophisticated operation to offer more sophisticated and healthy food products. The frozen bakery products keep the food fresh for a longer period of time. Coghlan (2015) stated that one of the main reasons of the growth of the frozen bakery is the habit of consumers to have food on the go. In the busier life style, people are more tend to skip their meals and often opt for frozen bakery products (Ahmad et al. 2014). It is for the same reason, has been assumed that the frozen bakery industry is expected to continue to flourish in major developed and other developing countries of the world. Fig: Frozen Bakery Products Market Size Trend, 2013-2020 (Source: Therkelsenet al. 2014) Porters Five Forces analysis Of Frozen Bakery Industry: Forces Analysis Bargaining power of suppliers If the frozen bakery industry is considered, it has to be said that the suppliers do not hold much importance in negotiation. However, Martnez-Monzet al. (2013) pointed out that the frozen bakeries are highly affected by the price swings of the raw materials but significant swings are noticed when it comes to global supply. Bargaining power of buyers Buyers bargaining power is significantly noticed when it comes to selling the products in super markets or local grocery stores. It is due to the presence of large number of small bakeries and other outlets, buyers are able to command low prices and discounts on voluminous purchase of products (Ashton et al. 2014). Rivalry among companies Frozen bakery industry is growing at a rapid pace, and there have been introduction of several bakery industries in the recent time. As pointed out byPinto et al. (2014), there are many bakeries that can provide similar services and provide frozen bakery products. Therefore, there always remained a chance of competition among various shops and businesses in this industry. Moreover, competition in this market seemed to increase as there is greater scope of innovation and production of new products within this industry (Lim et al. 2014). Threat of new entrants As it has been observed that there are a number of factors that facilitates the opening of a bakery shop that deals with bakery or frozen bakery products, there always remained the threat of new entrant in the market (Nguyen 2013). Depending on the ability to acquire distribution channel and their ability to create customer loyalty in the said market, entering in a new market can be easy. Threat of substitute products Bakery products can easily be substituted by other related food products like cake, cookies or any other food that can fight the appetite of people. In this respect, Nayak and Waterson (2016) further commented that people prefer to have frozen bakery products only when they run out of time or they find it convenient to stop for the frozen item. Therefore, there remained greater chance of substitution of products with respect to the frozen bakery products. Fig: Porters Five Forces analysis of Frozen Bakery Industry (Source: Created by the author) In case of Bakers Maison, the following can be mentioned Supplier of Bakery products Australian Bakery Supplies, P.E. Foods, Australian Catering Equipment Supplies and others. Barriers to New Entry bakery industry Entering into a new market might be challenging that will require financial as well as strategic analysis of the new market. Buyer of bakery products The buyers include consumers from all levels. People of all ages buy bakery products. Threat of substitution With other fast food products and dessert items, the substitution of these products is high. Degree of competitive rivalry The degree of competition is high due to the presence of huge number of competitors in the bakery market. A glimpse into the future of the bakery industry: Big companies from the developed countries are seeking opportunities and are opening their branches or outlets in the major other countries where the market demand is high. Countries like India, China are the major attractive locations for this industry. One of the basic reasons for this change in pattern is the changing age base of the population accompanied by emergence of middle class population. Their preferences have been conveniently found to move towards packaged baked goodies (Aaltonen and Hytti 2014). This has been evident by the increasing per capita consumption of bakery products. However, the threats related to the entry of new entrants and meeting the demands of the buyers might prove to be challenging to this industry. It has also been observed that the political as well as economic condition of the present situation is effective enough to support the industry Frozen bakery industry and its products is gaining importance in the recent time. Bakery products have become very popular across the globe. In India, bakery industry is the largest food processing sector in the country. Europe is the largest market for bakery products. On the other hand, US market has been flourishing in the bakery market (Martnez-Monzet al. 2013). A number of factors can be mentioned here that drives the profitability of the bakery industry. These are mentioned as under: Frozen Bakery industry in retail The global market for Frozen Bakery Products has been assumed to exceed US$485 billion by the end of 2020. Asia-Pacific also ranks as the fastest growing market with a CAGR of about 6.7% (Dobrucka 2013). In this respect, it has been mentioned that Europe happens to represent the largest consumption of frozen bakery products worldwide. Bakery business can be initiated by an individual easily. Owning or renting a small space for the business can initiate a small or mid-sized bakery business. There has been great improvement in the transportation and distribution system that has lead to the provision of supplying goods and products to different places (Zerrilloet al. 2016). In addition to this, the packaging of baked goodies has created better provision for transporting bakery goods to places. Therefore, only with the help of small investment or by the means of acquisition and merging, a new industry can be easily set up. Frozen Bakery Industry in Catering and industrial sector: Changing consumption pattern: The major factors driving the popularity of the bakery industry is the increasing consciousness of people regarding their health. As commented byGimnez-Bastidaet al. (2015), people are focusing on the consumption of organic and natural baked goods like bread. ReadingJeonget al. (2013), it has been observed that there is a changing pattern in the consumption of food among the people around the world. Jeonget al. (2013) pointed out that people of Asia are losing their appetite for rice and wheat based food that happened to be the staple food for them. Internationalisation of business: Many companies are expanding their business outside their domestic sphere. In case of bakery industry, this form of business activity has been common. For instance, companies like Pizza Hut, Dominos, Burger king and many others are now global companies that are operating worldwide (Martnez-Monzet al. 2013). These companies are doing their business very effectively and the reason behind the prosperity of these companies is because these products are well accepted among the people. With the above discussion, it can be easily said that there is greater opportunity of the bakery and the frozen bakery industry in the recent situation. The opportunity is open in all the developed as well as developing countries. It is on the basis of the strategic decision and the strategic implementation of the planning of the major industries in this sector, it can be said that the industry has better chances of prosperity in the current as well as future. Frozen Bakery industry market drivers: It has been observed that the frozen bakery industry is gaining huge importance in the business sphere. The above-identified factors can be easily considered as the fundamental reasons of improving the state of the industry. As it has been pointed out that this industry has been gaining major importance and that the size of the market is increasing. Some other factors that might drive the future of this industry can be discussed as under: I) Innovation techniques: Bakery industry has been found to face a kind of turmoil due to increasing growth in the competition in the market. This has lead to the increasing importance of finding better and innovative techniques to be applied in the particular industry. As pointed out byNayak and Waterson (2016), there is a high potential in the growth of the industry. Consumers are experimenting with various flavours and types of foods that are meant for the bakery industry. ii) Availability of skilled workers: It has been observed that there many individuals are looking at the bakery industry as their professional career. This has lead to the situation where it is found that many people are opting for bakery courses (Martnez-Monzet al 2013). This has automatically improved the skill of these individuals that will definitely lead to a better situation for the bakery industry because these people are well groomed and trained for the particular work. Highly skilled workers can be available easily if there remains the need of more employees in the given field (Kenijz and Sokol 2013). Future of Frozen Bakery Industry: I) Expansion of the business: Many organisations related to the food and the restaurant industries are expanding their business towards the bakery industry. It is due to the increase in the market share and the increased demand of these products; major business-persons are opting for expansion in the field of bakery as well (Therkelsenet al. 2014). This has created the situation where major restaurant and other food related industries are taking the opportunity of increasing their business value by expanding their activity towards the frozen bakery products. The evidences of the expansion of the business both in the domestic and internationally is evident. In fact, almost every restaurant business is putting their hand on the bakery business. Thus, business expansion is a common scenario. ii) Mergers and acquisitions of firms: It has also been evident that there are many companies who have opted for the criteria of merging and acquisition and expanding in the sector of bakery. It is by the means of merging and acquisition, the particular company or industry also gains the opportunity of carrying out a competitive strategy in the market(Ashton et al. 2014). It is when the base market of the particular company is already set there remained the chance of better survival in the market than a start up company. In addition to this, there remained a level of brand loyalty of the particular company that also help in creating greater market domination. Thus, it can be easily said that the innovative techniques and the other factors like easy availability of skilled workers and ability of the companies to undertake merger and acquisition in the field of business will lead to the prosperity of the business. It has to be said that all the factors are acting as positive factors towards the improvement of the frozen bakery industry and thus, there remained better scope for the industry to carry out its activity by various means. Conclusion: The evaluation of the current and future trends of the frozen bakery market it has been observed that the industry has great future in terms of market size. Frozen bakery industry is gaining importance in the recent perspective due to several factors. The major factor of increased popularity of frozen bakery industry is the changing lifestyle of people and the easy availability of the food items to match the need and the demand of the people. Analysing the Porters five forces, it has been found that although there is less influence of the suppliers that affect the industry largely. There has been increasing number of consumers in the frozen bakery industry. It has been found that many companies are actually expanding their business towards this industry due to the increasing demand of the frozen products. Therefore, it can be easily said that the frozen bakery industry has greater chances in the future. With the increasing people in the list of fast runners due to their lifestyle, there is great opportunity of this industry to prosper in the market. In addition to this, other factors that have been mentioned including easy setting up of the industry, availability of skilled labourers or the advancement in the technology that can cause mass production in short time or the availability of major preservatives help to boost the industry particularly. 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