Almarai Company is aiming to become the most successful processing plant courtesy of the many improvements initiated by the founder. Its substantial investment in advanced technological advancement places it among the most competitive businesses in the region. Also, the company’ partnerships with several organizations ensure in accesses more capital, and it can maintain stable growth. A SWOT analysis of the company will enable its executives understand their strengths and weaknesses, anticipate for opportunities and put measures in place to mitigate threats (Aithal, 2016).

SWOT Analysis

The 4Ps of Marketing

Products

Almarai strives to maintain a long line of high-quality products bolstered by the advanced production equipment and skilled employee base. Almarai offers Juices in a wide array of flavors, from strawberry, mango, apple, to mixed fruit. The company started with dairy products, meaning that they maintain a superior quality of milk and desserts. Their market segmentation techniques spotted a niche in kids’ products where the company launched many varieties like Zady, and UHT flavored yogurts and milk. Almarai also delivers home snacks and, poultry and culinary products of different assortments.

Price

It is undoubted that Almarai offers the best rates in the market. The company serves a considerable number of 43,500 customers a day within the GCC states. Additionally, the company bought many plants before venturing into the bakery business. This move allowed them a better chance at fixing workable prices that would enable them to maintain operations by breaking even and, to start making profits as early as possible. Additionally, there is a high customer value which motivates buyers to pay without complaints.

Place

Almarai’s central processing plant sits on a strategic point allowing it to supply all of its products to the various shops, supermarkets in time. The company also employs the use of sales locations to enable loyal customers to get access to the goods at their convenience. The company transports raw materials, dairy, and poultry, from farms and into the processing plant and the uses refrigerated trucks to distribute the finished products to the over 42,000 shops located in all the GCC states.

Promotion

Almarai has a clear and uncluttered packaging design that allows clients to recognize the products easily. This strategy ensures that purchases even in their hurry cannot mistake another product for Almarai’s poultry, milk or yogurt. It is impossible that the company uses small scale advertising methods and still be able to reach a high number of customers per day. The company employs expensive advertising methods to ensure that all individuals from the GCC states are aware of new products and changes in design and flavor. It uses market segmentation. A  representation of this strategy is the kids’ products section that is full of a wide assortment of flavors. Almarai dedicates a department that handles marketing strategies including partnerships that enable the company to maintain a significant share in the market.

Porter’s Five Forces Model

Porter’s concept of competitive analysis is crucial to understand the ability of the company to withstand external factors that might reduce its advantage and grant it to another business organization dealing in the same line of products. This model points out the stability of Almarai in the region and in most products in which it trades (Morrison, 2019).

Competitors Rivalry

Before venturing into the bakery business, Almarai bought Jedder-based Western Baker. A year later they initiated the construction of their baking facility and got into a joint venture with Chiyan and Olayan Finance Company. This move allowed the company to settle into the trade stably, by acquiring both skilled employees and a significant market share. The company uses the strategy of partnerships to mitigate the threat posed by other players in the market.

Threat of Entry

Almarai is a well-recognized brand giving it a foothold on its customers. It has well-designed products that make it easier for customers to spot it. The company invested heavily on advanced technologies applied in production facilities. This advancement allows the company to produce more goods at a low cost allowing it to be flexible in its pricing. Flexibility in the process enables the organization to respond adequately to new players in the quest to reduce its profitability.

Threat of substitution

There is a domestic market that remains highly untapped in the region. Additionally, the company got into various partnerships to guarantee its access to a broader consumer base and, more finances. The company maintains superior quality for its products courtesy of its skilled employees and advanced equipment.

Buyers Power

Based on the increased demand for health beverages internationally, buyers remain loyal to the company for its healthy, natural and fresh products. It hence, means that the consumers will not be in a quest to complain about prices as Almarai offers an undisputable consumer value. The company also serves thousands of customers from different states with different market factors.

Suppliers Power

Almarai has its farms that produce poultry and dairy products, the primary raw materials for its business. It inherently means that Almarai possesses the power to choose its suppliers for other materials without a significant overall effect. The firm enjoys the benefits of its well-known brand which reduces the power suppliers have on the company.

Product Portfolio with the BCG Matrix

The BCG matrix enables business organizations to evaluate their product portfolios to understand what products are doing well and which ones take in too much investment and give little or no return. This assessment will ensure Almarai knows its best-selling commodities and those that are lagging regarding sales. The BCG matrix categorizes products into Dogs, Cash Cows, Stars or Question marks according to the market share and its average rate of growth (Jurevicius, 2019).

Dogs

These are the products which hold the least sharein a slow-growing market. For Almarai this would mean culinary products and home snacks. This consumer goods are luxurious and do not command a vast market share. Also, their demand is not likely to grow in the future. However, the company still produces it for prestige and also because the few individuals buying it would cause a social issue for the company.

Question Marks

The commodities in this category are those that require close attention by the business, as they hold potential. Almarai needs to ensure that poultry products, the recently added goods, have enough resources, both financial and human. The market share for this commodity is growing, and it would be a great source of revenue for the organization.

Stars

Even in fast-growing markets, stars still maintain a significant proportion of the market share. Bakery products fall into this category. The company’s high investment on the product is the basis to its falling under this group. Almarai bought the Jedder-based Western Bakeries, constructed a new facility and got into two partnerships in the quest to increase its competitiveness with substitute goods.

Cash Cows

Cash cows are the most profitable products of a company. Almarai started the business with dairy products because of its high demand. Many people nationally and internationally buy at least one packet of milk or yogurt for their families. Although the market may not be growing, the market share remains considerably high.

References

Aithal, P. S. (2016). Study on ABCD analysis technique for business models, business strategies, operating concepts & business systems. International Journal in Management and Social Science, 4(1).

Jurevicius, O. (2019). How to Focus on the Stars with a Clever BCG Matrix. Retrieved from https://www.strategicmanagementinsight.com/tools/bcg-matrix-growth-share.html

Morrison, M. (2019). Porter’s Five Forces – Competitor Analysis (Michael Porter). Retrieved from https://rapidbi.com/porters-five-forces-competitor-analysis-michael-porter/

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