The Australian ice cream industry and its challenges
The study focuses on the topic of supply chain management. The specific focus of the report is concerning the establishment of a new business by Daniel and Peta Day for ice cream manufacturing. The specific aspects of supply chain that can govern the business and the subsequent strategies are formed. Daniel and Peta want to open their ice cream shop in Australia. However, the ice cream industry of the country provides mixed fortunes. The report will focus towards understanding the Australian market in order to provide systematic strategies that can ensure positive business growth of the ice cream shop. The enhancement of the supply chain function of the organization for ensuring greater productivity will be the essential subject of the study.
The ice cream industry in Australia is fairly large. The operating enterprises in the Ice Cream industry in the past had mixed fortunes. The industry has been performing significantly well in the last five years. From 2009 to 2014 the ice cream market of Australia had a growth rate of 5.1 per cent. As of 2018, the value of the ice cream market is 4,181 million US Dollars. The growth rate of value for both off-trade and on-trade were 2.2% (Ibisworld.com.au 2018). The most consumed ice cream category in the country are take home ice cream and bulk ice cream. The growth rate of take home and bulk ice cream for the period 2014 to 2019 was 1.8% (Gibb et al. 2016).
Some of the largest companies in the country are Baskin Robbins, Peters, Unilever Australia, Regal Cream Products and Bulla. Concerning ice cream shops, the most important and successfully performing companies are Gelato Messina, St. Louis fine ice creams, Nitrogenie and N2 extreme gelato. Among these ice cream shops the biggest competitor in the Queensland market is Nitrogenie as it is available only at various places within the state. Hence, it can be said that the competitive landscape of the ice cream industry in the country is huge. Given that the country has both large ice cream manufacturers and local shops selling ice creams the completion is formidable in the industry (Ibisworld.com.au 2018).
In order to take advantage of the Australian ice cream industry the most important factor is innovation. The consumers are recently generating a liking of ice cream made to order with the help of liquid nitrogen. Another major factor that is affecting customer preferences is variety. Ice cream shops are being preferred where a large number of options are available (Formentini and Taticchi 2016). The customers are preferring shops that provide local flavors. It has become much important for the customers to explore newer and better flavors. A very important change that has occurred is in regards to the shift of public demand towards healthier ice creams with natural ingredients. People are now more likely to consume ice cream that have added health value and also not high on the calorie factor.
Critical aspects for success in the ice cream industry
Sunny Days need to be a brand that can boast of variety, availability and market flexibility. The most important factor that can contribute towards the growth of the business for Peta and Daniel is supply chain functionality. This is because ice cream manufacturers in the country depend greatly on the crucial supplies. The strategy for Sunny Days should focus on reaching niche markets. This is a growing trend in Australia and can result in added benefits towards the essential growth of the company (Rueda, Garrett and Lambin 2017). It is also much important for the business to find effective ways to cope with the seasonal demand for the product. Ideally, ice cream is mostly consumed in the summer season. In Australia, this means the end of the year and the first few months of the New Year.
Strategic relationships refer to mutually beneficial agreements between two or more business entities. These relationships mostly help towards strengthening the supply chain of a given enterprise. In relation to the Sunny Days brand, strategic relationship will be required to be had with local dairy farms in an around Queensland. Hence, the dairy requirements can be sourced from the local dairy farms in and around the state of Queensland and preferably close to Gold Coast region (Sel and Bilgen 2015). The workforce need to be sourced from the local areas. Gold coast is a bustling tourist spot with many large hotels. The workforce can be sourced from these hotels. Meaning that experienced chefs specialized in the techniques of producing ice creams can be utilized. Gold Coast is one of the technologically advanced and forward places in Queensland and effective machinery is readily available. Peta and Daniel can set up manufacturing units at strategic locations that are both close to the farms and the shop. This will help in the easy procurement of the resources and help in the better distribution of the finished products. To cope with the seasonal demands the owners need to create strong business relationships with more than one dairy farms. This will ensure that the required resources are sourced from various sources to meet the demands of the peak season (Rajeev et al. 2017). The hiring of locals as employees will also ensure that being closer to their homes, the employees can cope with the greater pressures in summertime.
Monitoring becomes very much necessary in regards to the business venture. Firstly, specific monitoring strategies need to be implemented to help in the better planning of supply chain activities. Hence, it becomes much important that the supply chain management planning is reviewed. Secondly, segmentation of the supply chain is very much required. Thirdly, periodic evaluation of productivity needs to be implemented strongly across the operational levels of the shop. By this time it is week 11, hence there is ample information available for primary analysis of the data emerging from the initial phase of business.
Strategies to enhance supply chain functionality
An important measure for performance of the supply chain is through analyzing whether the supply is in line with the requisite demand. The first stage is the procurement of initial resources. The quality of dairy that is being supplied by the farms need to be checked. Moving forward the manufactured products need to be quality checked. The time taken for the finished product to reach the customers need to be checked for evaluating the effectiveness of the supply chain. The next most important aspect is measuring the employee performances. This can be measured through the implementation of quality control systems. For the retail side of the business, customer feedback becomes much necessary to be collected. It will monitor how far the customers’ tastes have been affected by the product.
In order to ensure that the flavors being offered are meeting customer expectations, it becomes necessary to analyze the marketing trends concerning the ice cream industry. The tastes and the preferences of the emerging customer bases need to be considered. Moving forward the company needs to test unique flavors. Food critics can be called to taste these new unique flavors and in accordance with their views the new flavors can be tested among the customers. Upon good feedback they can be officially released. Feedback mechanisms should be implemented. The customers can be given e-feedback forms, text feedback forms or direct written feedback forms. Segmented customer analysis can be another effective monitoring technique.
The technological requirements that Sunny Days require can be divided into various segments for implementation effectiveness. The important segments will be communicational technology, customer data management, inventory management systems, manufacturing equipment, transport technology and data analytics technology. Enterprise resource management systems are IT systems that help to integrate the various data management systems into one compact and easily operable system. As the supply chain management is being essentially considered, greater focus should be given towards employing effective supply chain management technologies. Some of the technological aspects that can be used are GPS monitoring, location map systems, resource availability map, technical support vendors and various other technologies.
ERP and ERM technology can be effectively used in order to integrate the functions of all the technologies for ensuring better management of resources. ERM devices helps to optimize all the major functional aspects of an organization. It is basically a single system through which various data related to different organizational functions can be effectively managed (Christopher 2016). ERM technology is being widely used across the various ice cream shops. The most important usage of the same is being done to identify the requirement of specific flavors of ice cream. Moreover, the essential requirement for production is also being effectively found through the implementation of this technology. In regards to the manufacturing process, the new trend across the ice cream industry is the usage of liquid nitrogen to cook the ice cream. This technique is being utilized to present ice creams in new ways. The taste of the finished products are also being enhanced through the utilization of this process. Effective means of communication within the various levels of the company and the integration of the same communication with the suppliers need to be optimized through better technologies. Inventory management devices should be effectively utilized. For increasing the effectiveness of the manufacturing functions utilization of special containers that help to maintain the temperatures of the products are required.
Conclusion
In conclusion it can be said that the business success of Peta and Daniel depend on how effectively they can manage their supply chain. It needs to be noted that the new age consumer in the Australian food market is niche based. This necessitates the effective provision of product options before the consumer. This is possible through harnessing the local healthy produce of Queensland. It can be said that effective management of the supply chain functions can help towards the effective realization of market opportunities. It is important to understand that the somewhat difficult situations of the Australian can be effectively tackled through efficient management of supply chain.
References
Boonjing, V., Chanvarasuth, P. and Lertwongsatien, C., 2015. An Impact of Supply Chain Management Components on Firm Performance. In Proceedings of the 6th International Conference on Engineering, Project and Production Management (pp. 555-565).
Christopher, M., 2016. Logistics & supply chain management. Pearson UK.
Crino, M., Sacks, G., Dunford, E., Trieu, K., Webster, J., Vandevijvere, S., Swinburn, B., Wu, J.Y. and Neal, B., 2018. Measuring the Healthiness of the Packaged Food Supply in Australia. Nutrients, 10(6).
Formentini, M. and Taticchi, P., 2016. Corporate sustainability approaches and governance mechanisms in sustainable supply chain management. Journal of Cleaner Production, 112, pp.1920-1933.
Gibb, J., Connolly, H., Collins, E. and Pavlovich, K., 2016. Nice guys making Nice Blocks. Journal of Management & Organization, 22(1), pp.133-137.
Hugos, M.H., 2018. Essentials of supply chain management. John Wiley & Sons.
Ibisworld.com.au. (2018). Soft Drink and Pre-Packaged Food Wholesaling – Australia Industry Report. [online] Available at: https://www.ibisworld.com.au/industry-trends/market-research-reports/wholesale-trade/grocery-liquor-tobacco-product-wholesaling/soft-drink-pre-packaged-food-wholesaling.html
Rajeev, A., Pati, R.K., Padhi, S.S. and Govindan, K., 2017. Evolution of sustainability in supply chain management: A literature review. Journal of Cleaner Production, 162, pp.299-314.
Rueda, X., Garrett, R.D. and Lambin, E.F., 2017. Corporate investments in supply chain sustainability: Selecting instruments in the agri-food industry. Journal of cleaner production, 142, pp.2480-2492.
Sel, Ç. and Bilgen, B., 2015. Quantitative models for supply chain management within dairy industry: a review and discussion. European Journal of Industrial Engineering, 9(5), pp.561-594.
Wu, J.H., Neal, B., Trevena, H., Crino, M., Stuart-Smith, W., Faulkner-Hogg, K., Louie, J.C.Y. and Dunford, E., 2015. Are gluten-free foods healthier than non-gluten-free foods? An evaluation of supermarket products in Australia. British Journal of Nutrition, 114(3
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
