Executive Summary
Caroline’s Real Bread Company are a small village bakery who produce and sell a variety of niche breads to cater for specific needs. Emphasis is placed on high-quality, fresh organic products. Their products are sold through their website, farmers markets, food festivals and other outlets. They also provide bread for specialist restaurants and café’s. This report provides an analysis and evaluation of the current state of the grocery market, and provides recommendations on the possible actions that should be undertaken for Caroline’s Real Bread Company to expend and take advantage of the current state of the industry.
Methods of analysis used in this report include PEST analysis which analyses the external factors
As a result of this, suppliers of foods high in salt, sugar or fat may need to rethink their production process or risk losing customers. This change, combined with the growing healthy eating awareness of the UK will again benefit companies who are producing organic foods with natural ingredients.
3.2 Economic
An increase in interest rates has led to less disposable income which may change their shopping pattern from buying luxury goods to necessities, thus restricting the growth of a company like Caroline’s (Times, 2013) (Keynote, 2012, p. 13). Additionally, a rise in inflation would increase the price of any grocery product, resulting in lack of growth in the overall market (Gurdian, 2012).
Adverse weather conditions in Europe had a negative effect on wheat supplies, thus increasing the cost of wheat (Keynote, 2012, p. 11) (Julia Glotz, 2011). Retailers can either let their profits decrease, or raise their prices and risk losing customers, to combat this rise (Keynote, 2012, p. 33). The price of flour has also risen, by £75/tonne (Gyton, 2012).
In recession, most companies face decreased revenue. As this particular business is more focused on providing good quality products, they charge more than supermarkets would, again resulting in a change in consumer