CASE STUDY- 'EUROFREEZE'

Case Study- 'Eurofreeze'

Summary of Eurofreeze

Eurofreeze frozen food has the focus of maintaining the high quality of food because of its main goal of sustaining the customer satisfaction. As Eurofreeze possess the widest variety in appetizer and the imported products. Eurofreeze has the ability to control all phases before or after the distribution, taking safety and performance standards (Economic Co-Operation, 2006). From taking orders to marketing, launch or impulse products to working hand in hand with our suppliers. The company has examined its strategic options to attain its goals along with strategic decisions. The case which has been discussed evaluates the strategic options which are evaluated in order to reach a certain decision.

Strategic Position

The company has considered a number of strategic options. The basic analysis is being conducted by using the cost of capital. The company compares its strategic option with its major competitor Refrigor in the market. It took a portfolio analysis in the year of 2003 the options clearly show the analysis of the net prsesent value with the change in number of market sales (Economic Co-Operation, 2006). Currently, through market analysis the company has low market share with respect to the market growth of Refrigor. Current sales of Eurofreeze are half the sales of Refrigor. However the overall market growth is five percent of market share of vegetables and fruit category. The other products of C&G (cakes & Geteaux) and Savoury have high market growth which is around eight percent but cater fewer sales. The overall market growth of Eurofreeze needs proper strategic options in order to compete with its competitor. The further portfolio analysis of the company has derived few of the strategic options that are being discussed in the study.

Scoring Criteria to Assess Each Option

The scoring criterion for the company is dependent on the efficiency of investment and its overall cost of capital along with the total sales of the year. The dependency of NPV towards the growth perspective is being focused in assessing these options (AAKER, 1995 p-55). The companies first evaluate the net profit value of all the three options and choose the best strategic option with maximum growth returns. The second criterion is on the basis of cost of capital the current working capitals of the company shows the number of assets that company posses in order to pay back the current liabilities of the company to meet financial obligations (Hilliam, 1987 p. 156). Scoring is also been observed with the number of total sales that gives projection to the market growth of the company.

In the first option, there is sales decline of 400 million dollars in the first year, similarly, the decrease of 200 dollars in the next year. The company has planned to stop selling its branded and labeled products (Hilliam, 1987 p. 156). Although the company has positive working capital indicating that it will be able to meet its short term financial obligations. However, the company has low net financial surplus in this option ...