Ice-Fili was a top ice cream manufacturer in Russia in 2002. By that time, the company had managed to overcome the consequences of both the Soviet Union dissolution and the financial crisis of 1998. However, the company and its managers also faced a few key issues that deserved specific attention. Firstly, it refers to a competition that was challenging for Ice-Fili. According to Rukstad et al., the company worked together with both domestic and foreign rivals (1).
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Local competitors included small ice cream manufacturers that offered a limited range of products, but it does not prevent them from accounting for “about 30% of the domestic market” (Rukstad et al. 11). At the same time, some foreign companies, including Nestlé and Baskin & Robbins, “became fully capable of domestic manufacturing through regional production plans” (Rukstad et al. 11).
Secondly, distribution challenges were also crucial for the given company. Thus, Rukstad et al. indicate that Ice-Fili distributed 80% of its products through kiosks and minimarkets but did not actively participate in “distribution activities because of the huge capital investment” required (8). Consequently, it was almost twice easier to find a Nestlé ice cream than an Ice-Fili product in the Russian market (Rukstad et al. 8). Finally, it was also essential for Ice-Fili to find talented and experienced specialists because the current state of affairs demonstrated the lack of skill in the industry (Rukstad et al. 1). Thus, the information above denotes that competition, distribution challenges, and the lack of talented employees were critical issues for Ice-Fili.
According to the information above, the firm required specific actions to be taken to address the three issues. As for the competition, it was reasonable to utilize a few strategies. On the one hand, Ice-Fili could follow some western standards to improve the quality of its products. It relates to the fact that numerous customers decide on what ice cream to buy according to its quality. On the other hand, a useful option was to increase the range of Ice-Fili products. It referred to both providing domestic customers with new kinds of ice creams and entering foreign markets with, for example, dry ice for beverages.
At the same time, it was necessary to address the distribution issues. Since supermarkets were among the fastest-growing trade channels, a reasonable option for Ice-Fili was to shift its focus from kiosks to these larger establishments. In addition to that, distribution success significantly depends on marketing strategies. It means that the given firm had to sponsor advertisements that mentioned its name and products often.
Finally, it was possible to hire talented and experienced specialists by offering attractive working conditions to them. For example, it could be a useful decision to create a premium system based on employees’ qualifications, overtime, personal initiative, experience, and others. In this case, specialists could see that employers appreciated their skills, and it could contribute to the increase of talented candidates.
In conclusion, the information above has demonstrated that Ice-Fili faced significant issues in the early 2000s. It refers to severe competition, distribution challenges, and the question of how to hire skillful employees. Even though these phenomena stand for essential difficulties, there exist specific actions that can address them. They include improving quality and increasing a range of products, developing effective distribution and marketing strategies, as well as creating an attractive image of the company among employees. These measures require essential investment, but they can contribute to the future growth of Ice-Fili.
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Rukstad, Michael, et al. “Ice-Fili.” Harvard Business School, 2005.