4aa3

Case Study

Module 1: Bakerview and the Ice Cream Industry

Course: COMM 4AA3

Instructor: Tien Lee

Section: C04

Due Date: January 24, 2013

Name | Student Number | Email |

Deng, Xinru | 0966987 | dengx6@mcmaster.ca |

Zhou, Mengyuan | | zhoumy2@mcmaster.ca |

Activity 4 Current Events in the Industry

Global Event

Global warming has been an ongoing issue for more than two decades. Recently, a study was conducted by several Stanford University scientists. The result has concluded that if greenhouse gas concentrations continue to rise, the summer temperatures of many regions in the world will experience an irreversible increase within the next 20 to 40 years. In the next two decades, tropical regions of Africa, Asia, and South America may see permanent and “never-before” temperature in the summer; and within area of Europe, Asia, and North America, there will likely see extreme shifts of temperature in the following 60 years. Combine the hottest year of 2005 and 2010, the worldwide average temperature has raised 1.12 degrees Fahrenheit above normal temperature.  (Zelman 2011)

This dramatic rise in seasonal temperature could severely affect the production of milk. When the weather gets hot, the cows on the farms do not eat as much, therefore they will not produce as much milk (Ciavarri 2012). As the quantity of milk produced decreases, the price goes up quickly. This phenomenon will lead to less amount of supply, higher cost of resource, and lower profit margin, which directly impacts the dairy industry from a financial perspective.

The changing in weather will also affect Bakerview Dairies as well. Since milk is the main ingredient of making ice cream, the increase in the price of milk will strictly increases the cost of production, which in turn will decrease profit margin and lower revenue.

Canadian Event

The CBC News has reported that, by 2010, 25% among the Canadians are obese and the trend would continue in the following ten years at an...