michel et augustin

Essay by Sid146 November 2014

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Cass Business School, MSc Management, Group A9

1. To begin with it is worth mentioning that development of the biscuit's market in France was

much slower in comparison to global figures during 2005. Thus average volume increased only 1.1% in

this period whilst in other countries it was 3 times higher.

Also, main competition was based on pricing rather than quality and that makes bakeries

produce more. However small companies can't do this therefore the biggest market share belongs to

well­established bakeries.

Concerning distribution channels, it was difficult to sell direct to the customers since vast

majority of biscuits were sold in supermarkets (75.1%) which quoted the price 40­80% higher than

producer's. It relates only to small companies since they don't have any choice but to agree to their

conditions. Moreover, there is a bulk of international companies which introduced their products into the

french market such as German Bahlsen GmbH & Co. or United Biscuits. This made for stiff competition

within the industry. Consumption is also lower in comparison to other countries such as the US.

Talking about core customers, all people in France love biscuits, however people aged 24­49

eat it twice lower than teenagers. It is clear that elderly people go to the supermarkets more often than

teenagers that means they may not always buy so many biscuits for their children aged under 15

because it is unhealthy.

The attractiveness of this market can be viewed using porter's five model, namely, industry

competitors, potential entrants, availability of substitutes, buyer power and supplier power. As for

industry competitors, we can see that there are a lot of competitors, not only nationally but also

overseas. Moreover, the competition is based on price most of all and this could adversely affect any

start ups since their initial costs are...