Bigelow Tea Company is one of the dominant tea companies in the US market. It was founded in 1945 and remains being a family-owned business (Www.bigelowtea.com, 2016). The company provides its customers with over 50 varieties of tea products including the green, white, black and all sorts of herbal teas. Bigelow’s products are available in most grocery retail shops nationwide. The company also has managed to effectively engage its customers through its catalog that is available on the company’s website. According to the firm’s annual statistics, revenues have remained at over $ 90 million every year over a decade now (Privco.com, 2016). This paper provides a general internal analysis of R.C. Bigelow Inc. Specifically, the report utilizes the SWOT analysis as well as applying the VRIO framework to analyze the four resources categories for the business.
SWOT analysis
The SWOT matrix is an effective tool that helps in understanding various elements of the business environment to which a company operates. The incorporated elements include the potential strengths, weaknesses, opportunities as well as the threats that a business face. Using this tool ultimately uncovers Bigelow’s current operational status that gives the company the competitive edge especially in the highly competitive tea & food industry.
a) Strengths
The major operational strength of R.C. Bigelow is that the company owns a tea plantation in Charleston. In fact, the plantation is the only one available in the nation. Such a possession has enabled Bigelow to source its raw tea at relatively low prices hence keeping the production costs of the company relatively low compared to competitors (Brown Bigelow enhanced SWOT, n.d.). For this reason, Bigelow has managed to operate competitively in its quest to provide consumers with high-quality products at a low price.
b) Weaknesses
The staff at Bigelow has done everything possible to limit any chances for operational weaknesses. For instance, the brand portfolio for Bigelow has long been considered as the central area of weakness. Compared to competitor businesses, Bigelow has not managed to maintain a high-end product recognition despite have existed for almost a century.
c) Opportunities
As suggested earlier, R.C. Bigelow operates in large scale specifically covering the entire market of in a strong nationwide presence. To some extent, this has provided the company with a unique opportunity to realize new markets (Cadle et al., 2014). It has also enabled the company to enjoy the advantage of economies of scale hence ripping out higher profits year after year hence making the company’s stability higher compared to competitors.
d) Threats
R.C. Bigelow’s major operational threat is the ever increasing rates of interests as well as the unpredictable changes of prices of the products. Competitor companies sometimes offer services at unpredictably varied pricing strategy hence making it hard for Bigelow to put an effective and independent pricing strategy (Brian, 2015). Also, government regulations as the firm operate in different States offers a functional threat.
Analysis of the four resources Category
The identified resources include; land, labor, entrepreneurship and most importantly, the capital. Bigelow’s labor force is adequate as the company has over 350 employees in its retail ends. In terms of land, the company has large asset base where production services take place effectively. For instance, the plantation at Charleston remains crucial in facilitating the firm’s smooth operations. Also, the firm’s operational experience in the market has greatly helped in terms of capital management and identification of new opportunities to maintain its high competitive edge over competitor companies.
VRIO Framework
This framework is a strategic process that forms a central part of an organization’s larger strategic scheme. It guides a firm to embark on sustainable strategic choices successful implementation. The framework forms part of a business internal analysis. Specifically, it addresses different elements namely; value, Rarity, Imitability and general organization. Starting with the aspect of value, it refers to the extent to which the firm has exploited opportunities to neutralize or limit the capabilities of external threats. In this case, R.C. Bigelow has been utilizing the opportunities available for its existence on the global stage to create value. This has made it hard for competitors especially new entrants to make it a success in the industry.
In terms of rarity, R.C Bigelow exclusively enjoys the rare opportunity of owning a large tea plantation in the country. This has made production costs relatively low hence boosting the firm’s profit margins. However, there is a huge deal of product imitation in the industry in which Bigelow operates. Most competitor companies offer similar products in the likes of White, Green, Black among other categories of tea products. Imitation poses a threat to Bigelow’s brands as well as act as a disadvantage to the firm’s quest to achieve its strategic objectives. Lastly, the organization of R.C. Bigelow has been vital in ensuring that the company effectively exploits resources and keep its continued market dominance. The firm has a huge personnel, resources and mechanisms for production purposes. It means that the functional as capabilities of R.C. Bigelow is highly organized.
References
Brian, R. T. (2015). New Report "Tea and Ready-to-Drink (RTD) Tea in the U.S.: Retail, Foodservice and Consumer Trends" available through Aarkstore Enterprise. Retrieved from http://www.onlineprnews.com/news/13656-1260008932-new-report-tea-and-readytodrink-rtd-tea-in-the-us-retail-foodservice-and-consumer-trends-available-through-aarkstore-enterprise.html
Brown Bigelow enhanced SWOT analysis - Strengths, Weaknesses, Opportunities, Threats of Brown Bigelow. Find 100,000 more reports. (n.d.). Retrieved from http://www.swotanalysis24.com/swot-b/17642-swot-analysis-brown-bigelow.html
Cadle, J., Eva, M., Hindle, K., Paul, D., Rollason, C., Turner, P., Cadle, J. (2014). Business Analysis. Swindon: BCS Learning & Development Limited.
Privco.com. (2016). RC Bigelow - Financial Report | Annual Revenue | Stock. Retrieved from http://www.privco.com/private-company/bigelow-tea
Www.bigelowtea.com. (2016). Our Family Story - Bigelow Tea. Retrieved from https://www.bigelowtea.com/Our-Family-Story
