Arcor: Global Strategy

In: Business and Management

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Arcor: Global strategy and local turbulence
Confectionary industry:
Confectionary industry is highly competitive industry. North America and Western Europe accounted for 2/3 of its sales, confectionary company are targeting the emerging market which is very attractive for chocolate and candy companies.
Consumer-Largely teens and adults are consumer of chocolate and candy products.
Substitute- substitutes of confectionery products are snacks, dairy and bakery products which is easily available in the market.
Competitors- c4 ratio for chocolate is very high (86%). But c4 ratio for candy is very low (17%). It means chocolate market is very competitive as compared to candy.
Supplier power- supplier power is low because most of the firm has its own supplier.
Entry barrier: chocolate- high, high investment requires. Candy –low.
Arcor: Arcor, world’s 13th largest and Argentina’s largest confectionary manufacturer is planning an international growth strategy at a time when Argentina is recovering from the worst financial crisis. Arcor has grown both volume and value to be a global player in the confectionary industry.
Arcor value proposition
1. Self-sufficiency in producing product input.
2. Low cost, high in volume and offering wide variety of products.
3. Efficient production capability.
(1) Arcor global strategy
Latin America: Taste preferences and consumption of Latin America is pretty similar to Argentina. So Neighboring country had historically been center of attraction of Arcor. They already had distribution capabilities, sales force, local offices and multiple factories. Arcor had faced difficulty in Mexico because it lacked a good distribution model and had not mastered local tastes.
North America
USA: Arcor faced difficulty when it entered into the US. 1/3 of total global consumption of confectionary market is consumed by the US people. Market is…...

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