Question

Market Structure. Choose one publicly-traded company to address the following:
Hint: a useful source is the firm’s annual reports (10-K) found in the SEC – Edgar website.

1. Identify the resources, capabilities, and/or core competencies of this firm.
   1. Are these resources, capabilities, and/or core competencies VRIO? Why or why not?
2. Identify the type of competitive strategy the firm follows. Explain in detail.
   1. Why do you think the firm follows this strategy? Do you think there is an alternate strategy best suited?
3. Conduct a simple industry analysis using Porter’s framework (i.e., five forces of competition).

Answer 1

Kerala State Poultry Development Corporation Ltd. is a Public Sector Undertaking (PSU). This comes under the Department of Animal Husbandry, under Governement of Kerala. Board of Directors along with the Managing director looks after the administration.

This corporation aims at a sustainalble production in the growth of chicks (broiler and layer), and there by attaining the self sufficiency in the requirement of poultry egg and poultry meat of the state. It also provides job opportunities for the women who belong to the poor families.

a. The resources of the firm are the following:

1. day old layer chicks ( BV - 380) - produced in their own hatcheries

2. Poultry feed produced in their own feed mill with required feed additives, to increase the productivity of the birds, in case of layer birds., and to increase its weight in case of broiler birds.

3. Their own meat processing Plant

4. Duck Farm

5. Their own restaurant

6. Time to time financial assistance from the part of Central and State Governments.  

The corporation is having high reputation in the State. It is having the  highest market share for the last couple of decades in the prodction of poultry eggs and poultry meat. In additon to the sales outlet of its own, it has a number of franchaises in different parts of the state.

Many useful projects are runnning by the government focused on ladies who belong to BPL (below poverty line ) categories, for which Kepco stands as the implementing agency.

The core competencies are the local market who can distribte  poultry meat at cheaper prices, because tax is not added in their products.  

i. VRIO frame work is a tool which is used to analyse, a firms internal resources and capabilities to find out its future competitive advantage.

It comes under VRIO frame work because of the following reasons.

1. Poultry farming is comparatively cheap and easy to manage.

2. It is easy to outsource.

3. Market demand for the product increases day by day.  

4. It increases job opportunities to the rural folk.

It also has some disadvantages as VRIO frame work.

1. The product (Poultry meat) is highly perishable, and it does not have very long shelf life.  

2. Transportation of chicks, as a part of business, has to be conducted, which may cause transit mortality and it makes heavy loss to the individuals who are behind it.  

3. Bird flu and other disease are common, and it makes it difficult for these birds to survive, and it also causes heavy mortality among birds, which may cause huge loss to the poultry farmers

b.Competitive stratey-

integration farming - providing chicks to the farmers for a period of 45 days, feed, medicine, etc. are also provided. Continuous monitoring of veterinary doctors and spervisors are provided.  

In the field of meat processing also there are close monitoring of veterinary doctors is provides. Top priority is given to the hygeinic environmental surrounding in the meat processing ares. Most of the stages of meat processing is with the help of machines.  

Good quality poultry feed produced in their own feed mill is more economic.

Cage system does not require more area.  

Hormone less chicken is another advantage, which increases the confidence of the consumers and makes marketing more easy.  

i. This strategy is more economic, and easy to practice.  

C. Porter's five forces frame work

1. competitive rivals

local market - cannot do any harm because the confidence of the public is already acquired wih the lable of a public sector undertaking. Hygeinic measures adopted, and the close monitoring of veterinary doctors added public interest.  

2. potential new market entrannce

Being a consmer product it does not have any negative impact

3. suppliers

No competent large scale poultry industry is existing

4. customers

whole heart support from the part of the cstomers for the past two decades is really appreciated

5. substitute products

No substitute products for poultry meat (chicken).  

Hence all the above factors helped to increase profitability of the organisation for conduting poultry business.