Ice-Fili strategic analysis
Ice-Fili is the largest domestic ice cream manufacturer in Russia. As a leader in the rather unattractive market, Ice-Fili is in a desperate fight to maintain its slim market share against the onslaught of competition from regional manufacturers and the well organized western corporations.
Financial Performance
According the company’s historical financial statements, Ice-Fili’s sales have steadily declined from a high of $68.8 million in 1997 to $25.1m in 2001. The company’s year to year sales have declined by an average of 11% over the past three years. Over the same time period, Ice-Fili’s net income also decreased by an average of 14% in spite of the fact that its cost of goods sold also decreased by an average of 14%. This is a clear indication that the company is losing its battle to sell more of its products while also selling at lower prices. In an attempt to win the favor of its suppliers, it appears as if Ice-Fili extended its credit terms allowing them to pay later than normal as it increased its AP by 231% from 1999 to 2000 and another 8% in 2001. In all, Ice-Fili’s troubling financial outlook is demonstrated by its steadily declining ROA and ROE from 27.3 to 14.4% and 33.8 to 16% respectively.
Company Resources
Value & Rarity. One of the most attractive aspects of Ice-Fili’s ice cream is known for its authentic natural ingredients. This combined with the fact that the vast majority of its ingredients are “home grown” makes the company value and rarity which are differentiators. Unfortunately, the company does not do an adequate job of promoting these facts to its customers.
Imitability: Unfortunately, the company’s primary source of income, ice cream manufacturing is easily imitated by competitors and has ...