Thursday, October 10, 2019
Innocent drinks Company Essay
ââ¬Å"Innocent drinksâ⬠is company that selling famous drinks in The United Kingdom which started by 3 Cambridge students in 1999. This is a drink that makes with 100 percent pure and natural fruit juice. Smoothies are the primary product of ââ¬Å"Innocent drinksâ⬠and people are aware of it due to its healthy image. The company provides different product range and the distribution of channels covered most of the supermarkets, coffee shops and etc. For every year ââ¬Å"Innocent drinksâ⬠will donate 10 percent of their profits to charity and this called The Innocent Foundation. This foundation has helped a lot of people. This report will analyses the process of ââ¬Å"Innocent drinksâ⬠from 1999 to 2013. 1.Organization Structure There are many types of organization structure, for example, hierarchical structure, matrix structure and etc. For different structure, it has different result, management and objective. ââ¬Å"Innocent drinksâ⬠was a small business in very competitive markets which is fit to entrepreneurial structure. The advantages of this structure are that the core team can make decisions quickly and for the members they can give some ideas to the core team and solve the problem that they are facing. ââ¬Å"Innocent drinksâ⬠started from entrepreneurial structure and turned to hierarchical structure after few years. The reason of ââ¬Å"Innocent drinksâ⬠turned into another structure is because they cannot satisfy their needs. They want to make themselves to be more famous and to earn more profit. ââ¬Å"Innocent drinksâ⬠thinks that hierarchical structure has a good scale that can separate into different departments to achieve specialization. This can let the employees know what spot they are doing and they can exert their abilities. For example, in marketing they can help to promote the product or to think of a new design to attract the customers to buy it. When every department do well in the way they have to, it is easy for ââ¬Å"Innocent drinksâ⬠to manage and achieve expected target like turnover. Ownership According to Finance maps of world ( 2012 ), ââ¬Å"Business ownership means having the control over business enterprise and being able to dictate is functioning and operations.â⬠From the beginning of ââ¬Å"Innocent drinksâ⬠there were created by three Cambridge students who are Richard Reed, Adam Balon and Jon Wright. They used 500 pounds to set up this business withà partnership. The advantages of having a partnership are they can share the responsibility and operate for the common goal of making a profit. On the other hand, partnership lack of finance to expend so ââ¬Å"Innocent drinksâ⬠decided to turn into private limited company in 2007 and it can separate legal identity, which can safeguard the operation of business and the company can debt more money from the bank it is because ââ¬Å"Innocent drinksâ⬠can be a mortgage. Moreover, being a private limited company can have the purchase discounts and this can save some money for the company. Two years later, ââ¬Å"Innocent drinksâ⬠has sold 18 percent of the company to Coca Cola which means that Coca Cola has the right to operate ââ¬Å"Innocent drinksâ⬠. In 2013, Coca Cola has fully control ââ¬Å"Innocent drinksâ⬠with 91 percent share. This cause that ââ¬Å"Innocent drinksâ⬠has only a small minority holding. Hence, ââ¬Å"Innocent drinksâ⬠turned into consultancy business which can only provide ideas and services. Growth Investopedia ( 2013 ) point out that ââ¬Å"Growth is an increase in the capacity of an economy to produce goods and services, compared from one period of time to another.â⬠Since the market change rapidly ââ¬Å"Innocent drinksâ⬠has to create new type of product to cater the needs of the customers. From the beginning, ââ¬Å"Innocent drinksâ⬠has only 3 recipes to almost 30 more over the years. The juice ranges of ââ¬Å"Innocent drinksâ⬠started from the original taste and evolve to mixed taste. The product ranges is different, including kid, smoothie and thickies. For example, kid drinks are specially made to provide all the essentially vitamins to sustain their growth. In this product, ââ¬Å"Innocent drinksâ⬠has made a different design and size to cater the needs children. 2.Reason of growth There are few reasons why ââ¬Å"Innocent drinksâ⬠can be grown rapidly. Firstly, advertising. ââ¬Å"Innocent drinksâ⬠has different advertisement on the television and for each advertisement it will represent their main product and shows that ââ¬Å"Innocent drinksâ⬠never sweetened and never concentrated. The use of the advertisement is to build up a healthy image of ââ¬Å"Innocent drinksâ⬠so that the customers will start considering to purchase this product. Secondly, PJââ¬â¢s smoothies is the main rival of ââ¬Å"Innocent drinksâ⬠. PJââ¬â¢s smoothies has changed the image and increased price because it wants to be aà premier brand. While PJââ¬â¢s smoothies increased its price, it lost some loyal customers at the same time. ââ¬Å"Innocent drinksâ⬠might be cheaper than PJââ¬â¢s smoothies, therefore, this cause more customers to choose ââ¬Å"Innocent drinksâ⬠. Finance is another factor that enhances the growth of ââ¬Å"Innocent drinksâ⬠. In 2004, the annual profit is 968000 pounds and it increases to 3066000 pounds in 2005. 3.Business strategy Business strategy is a business plan that takes place long-term in order to help achieve a specific goal or objective. Christina C (N.D.) The company analyzes the external and internal business environment before making an accurate decision. SWOT and PESTLE are the planning methods to evaluate the company. Strengths ââ¬â ââ¬Å"Innocent drinksâ⬠products are highly competitive because it made with 100 percent pure fruit juice and high quality and low price these are the advantages over the rivals. Weaknesses ââ¬â distribution channels are small and weak brand reputation compare to other drink companies. Opportunity ââ¬â ââ¬Å"Innocent Drinksâ⬠serve the expectation of producing 100% fruit drinks and change the consumer tastes because the new products can attract their attention. Moreover, the company expands the market including target elderly. This is a unique area that preferable than other competitors. Threats ââ¬â weather, the weather might affect the quality of the fruits and the transport and ââ¬Å"Innocent drinksâ⬠has many rival, for example, PJââ¬â¢s smoothies, Pepsi and Tropicana. Political ââ¬â The government is very concerned about health and safety. ââ¬Å"Innocent drinksâ⬠has to list out the ingredient on the product because it has to protect the consumer. Economic ââ¬â Since inflation and the increase rate of unemployment will affect the confidence of consumers. Therefore, they tend to buy a cheaper brand instead of ââ¬ËInnocent Drinksââ¬â¢. Moreover, the economic condition also influences the company. For example, the high costs of purchasing ingredients and the taxation. Social ââ¬â education, nowadays people are more concerned about their health therefore they will choose to buy a drink that is healthy for them, for example, 100 percent pure fruit juice and without any sugar. For population, ââ¬Å"Innocent drinksâ⬠has not o nly targeted the adults and kids but also the elderlies. Furthermore, ââ¬Å"Innocent drinksâ⬠will strengthen their brand through the advertisement, establish the healthy image in the society. Technological ââ¬â affect the production level ofà ââ¬Å"Innocent drinksâ⬠because of the innovative technology. It leads to producing the juice efficiency and reduce the productive average costs by economies of scale. Moreover, the advance of technology can improve the communication flow which is beneficial of making accurate decision. Furthermore, the use of technology is helpful for ââ¬ËInnocent Drinksââ¬â¢ to recycle the bottles. Legal ââ¬â minimum wage, for the company of ââ¬Å"Innocent drinksâ⬠they have to sign a contract with every worker to protect their pay. Environmental ââ¬â the trend of the world. The earth is facing global warming which makes ââ¬Å"Innocent drinksâ⬠decided to recycle the plastic bottles to save the world
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