Case 9: Rogers' Chocolates

Case 9

Rogers’ Chocolates

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Kandace Miller

February 7, 2011

MGT 442

Dr. Larry McDaniel

Case 9

Rogers’ Chocolates

1.) What is the competition like in the premium chocolate industry? Which of the five competitive forces is strongest? Which is weakest? What competitive forces seem to have the greatest effect on industry attractiveness and the potential profitability of new entrants?

Competition in the premium chocolate industry depends on the quality of the chocolate a company is producing, the tactics of advertising, packaging, and distributing the chocolate, and the location(s). The strongest competitive forces are rivalry among competing sellers, collaboration and bargaining with buyers, as well as suppliers for materials and resource inputs, and potential of new entrants. The weakest competitive force would be the firms in other industries offering substitutive chocolate products. Rivalry among competing sellers and collaboration and bargaining with buyers, as well as suppliers for materials and resource inputs seem to have the greatest effect on industry attractiveness and the potential profitability of new entrants.

2.) How is the premium chocolate industry changing? What are the underlying drivers of change and how might those driving forces individually or collectively change competition in the industry?

The premium chocolate industry is changing by the tremendous increase of the chocolate demand. For instance, the premium chocolate market was projected to grow at 2 percent annually in 2006. However, when some traditional manufacturers, such as Hershey’s, were moving into the premium chocolate market through acquisitions and upmarket launches, the premium chocolate market was growing at 20 percent annually. The demand of more chocolate and the emphasis of the quality and brand of the chocolate from the consumers were the underlying drivers of change. These driving forces...