Roger’s Chocolate

Roger’s Chocolate

Questions

1. What is the competition in the industry as premium chocolate? What of the five competitive forces is stronger? Why is weaker? What forces seem to have the greatest effect on industry attractiveness and the potential profitability of the new ones?

Rogers´Chocolates founded in 1885, based in Victoria, British Columbia and is Canada´s oldest chocolate company and British Columbia´s second oldest company. The company is in private hand and has long strong family values. The Firm also focused its business in four market areas; the direct retail (50 % of the company´s sales), wholesale, Online and Mail order and a restaurant called “Sam´s Deli, a cafeteria-style restaurant in Victoria. The company produces not only chocolate but also a line of premium ice cream. Rogers´s Chocolates operates in the premium chocolate market which was growing at 20 percent annually.

The competition in the industry as premium chocolate segment in Canada is based on regional brands and a few larger players. The competition among the premium segment include variation in quality of the products and other services offered to customers. The market is very seasonal and needs flavor introduction to gain customers, another serious point of the seasonally business is, the difficulty to predict the demand.

The rivalry among the competitors is very high and because of the growing of the premium chocolate market of 20 percent annually. The rapid growth and profit prospects factors are attractive enough to induce additional entry to this industry, so the threat of new entrants is the strongest competitive force. Based on the fact that Roger´s Chocolates operates on a market niche with high differentiation, high-quality and hand rapped chocolates and has customers looking for a luxury experience with a superior taste, allows the company to do price fixing. So the competitive pressure stemming from buyers bargaining power is very low. The threat of substitute products...