The rte cereal industry in 1994 case analysis competitive strategy presented by: raghav keshav why has rte cereal been such a profitable business the rte cereal market is a classic oligopoly with the four dominant players controlling. Ready-to-eat breakfast cereal industry in 1994 essay breakfast cereal industry in 1994 why rte cereal has been such a profitable business up to the 1990sready-to-eat breakfast cereal. The battle for the breakfast cereal market, by richard lynch 1 introduction and it has the potential to have a real impact on people's lives but it isn't the easiest subject to study there are several reasons for this: was both the market leader and was highly profitable, suggesting that the market was highly attractive. The rte business has been profitable since its inception consumption has increased tremendously since their introduction over 100 years ago contributing to the brands successes although sales have slipped for cereal makers rte cereal is still a favourite breakfast food.
1 why has the cereal breakfast been such a profitable business historically the rte industry has been characterized by a state of high concentration and limited competition, in which only three dominant producers - kellogg, general mills, and philip morris (the big three) had three quarters of the market share from the 1950's till 1993. The cereal business has been in steady decline for a decade as consumers opt for healthier options or food easier to eat on the run in the morning. The rte cereal industry had historically been one of the most concentrated of all us industries, and firm market shares showed great persistence (see exhibit 1) the largest cereal manufacturers were extremely profitable, routinely posting roas for their cereal divisions in the 15-30% range.
The historic profitability of the rte breakfast cereal industry over the course of the century preceding 1994, the ready-to-eat (rte) breakfast cereal industry was highly concentrated, with reliably high profitability for the industry’s “big three” branded cereal firms. Why has the rte cereal industry historically been such a profitable business what are the barriers to entry in the rte cereal industry 2 what changes have led to the current industry “crisis” what issues do the “big three” face in 1994 2 why have private labels been able to. Mib course syllabus course purpo se & objectives use the five forces framework to explain why rte cereal has been such a profitable business up to the 1990s 2 how did the industry structure change in the 1990s has it become more or less attractive as a result 3 how should the rte manufacturers respond to these changes turn in a.
Rte cereal industry with its 200 plus brands, concentrated in the portfolios of the top firms, has higher prices than it would have if its 200 brands were held in smaller, more numerous portfolios. Massachusetts institute of technology sloan school of management 15933 advanced strategic managment why has rte cereals been such a profitable business what changes have led to the current industry crisis how do the cost structures of private label and branded cereal manufacturers differ. A mix of old and new business cases has been selected on a range of companies from a variety of industry settings each case is intended to teach us something specific, yet each can teach many things why has the rte cereal industry historically been such a profitable business what are the barriers to entry in the rte cereal industry.
Weatherhead school of management case western reserve university mgmt 499 the world of business eg a sports team, charity, entertainment organization why has rte cereal been such a profitable business what changes have lead to the current industry “crisis. (a) why has the rte cereal been such a profitable business what changes have led to the current industry ‘crisis’ (b) why have private labels been able to enter this industry successfully. Discussion questions: why has rte creal been such a profitable business what changes have led to the current industry “crisis” why have private labels been able to enter this industry successfully how do the cost structures of private label and branded cereal manufacturers differ what does general mils hope to accomplish with its april.
The ready-to-eat breakfast cereal industry the rte breakfast cereal industry has long been a highly profitable and very stable oligopoly in 1994, industry leaders sense that the industry is at a crucial turning point, as private label brands have begun to make significant inroads against the branded cereals and competition among the branded manufacturers has intensified, primarily through. Kellogg's has consistently been the largest advertizer of its cereals in this country, spending roughly £50 million a year in recent years, about twice what its rival cereal partners spends. Preferential privileges in retail channel: incumbents have relationships with the retailers and get the most desirable shelf space to maximize chances of high saleswhy has rte cereal been such a profitable business.