Ice-Fili, Itâ€™s the oldest Russian ice cream producer. It originated from the former state-run Soviet company Moshladokombinat N 8. In 1992 it was privatized and registered as a private joint stock company under the name Ice-Fili.
Environment Analysis: PEST analysis
1- Economic Segment:
The case describes two economic shocks were the Russian ice cream industry, was suffered in general for all companies. The first, was after the dissolution of the Soviet Union in 1991 (Russian companies faced big structural changes due to previous state-run economy had to shift to an open-market economy, which require these companies to provide huge investment to compete with the foreign ...view middle of the document...
3- Social Segment
Ice Fili should consider positioning itself to be the main (in quantity) ice cream producer, so that it can capture that market, due to international company are coming into Russia and it wonâ€™t be as tough as it should to gain market share for them, since they are very expert in how to advertise and develop their brand, especially, With a (quantity) ice cream gaining popularity in major metropolitan areas like Moscow. Another sociocultural change that they have faced in my opinion, is how alcohol, soda have increased their popularity amongst the consumer in Russia, while they have increased, ice cream has decreased?
4- Technology Segment
The supplier of ice cream production equipments in Russia was increased from 1999. There were a least 10 private ice cream equipment companies in 2001 in Russia. The usage of old machines (4 numbers) do not help Ice Fili, looking into finding a new supplier of equipment and maintaining the quality of the ice cream produced is vital to their future success.
Business Level Strategy & Corporate Level Strategy
Ice Fili has positioned itself to pursue product differentiation as their business strategy. It serves 170 different ice creams, and won a silver medal for â€œProduct of the Yearâ€, they add near 20 new ones each year. The price they`ve set is about two Rubles higher than the lowest price category. They are trying to provide their Russian consumers with a unique, premium ice cream product as oppose to the generic brand.
As a business they haven`t been investing properly in advertising, and marketing to display their unique product. To have consumers want their product, they have to be more successful in grabbing their consumersâ€™ attention with good advertising, by paying more than their 1% that they are doing.
Porter 5 Forces:
In order to analyze the industry and environment of Ice Fili, Porterâ€™s five forces model will be necessary used to assess its competitiveness in the market. An illustration of the model specific to Ice Fili is attached. The analysis will lead to the identification of various opportunities for Ice Fili, along with determination of the most appropriate strategy and associated milestone for the strategy, which itâ€™s needed to keep company image to all consumers and off curse to investors in the market. Moreover, this analysis will make the rivals entries more difficult. The forces are shown below:
The threat of new entrants in this ice cream industry is low, due to the followings:
1- Starting with local government policy which is the low barriers to entry; it is a free market which allows international companies to enter with no problem. The open market economy attracted more foreign companies into the Russian market to capitalize on new opportunities. Foreign companies such as Nestle had already set up two factories in Moscow since the beginning of the open economy. Their option is to provide minimum requirements in this regard.