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Free «China Food» Essay Sample

China Food Company is located in the Shandong province of China, which has an estimated population of 94 million people (China Food Company plc, 2010; China Food Company plc, 2011). The key operation of the company is located in China; though, it has various subsidiaries in various countries including the United Kingdom, such as Full Fortune Holdings Pte. Ltd., Fuss Feed Co., Ltd., and Shandong Fuss Biotech Co., Ltd. amongst others (Hephaestus Books 2011). The company deals with the production of various products that are divided into animal feed and condiments. The wide array of products generated by China Food is sold via a network of outlets and distributors including Walmart, Tesco, Jialejia, and Carrefour. China Food Company boosts of a very strong brand of dipping and cooking sauces that are mainly distributed throughout Shandong and the neighboring provinces through the supermarket and the dense network of distributors. To satisfy the demand of the dense population in the province, the company opened a new factory in 2010, near the city of Shou Guang. This was mainly established to increase its capacity in the production of condiments (Financial Times 2011).

The Chinese local market is growing at a very fast rate, chiefly due to the economic prosperity, increased urbanization, and the growth of population. This augurs well for the company, and the opening of the new factory was meant to increase food capacity to take advantage of the favorable economic environment and the ready market. Consumer manufactured products include vinegar, chilli oil, bean paste, soya sauce, pickled products, and flavor enhancers. The company also manufactures animal feeds which include premix, compound and concentrate feed (China Food Company plc. 2011). The company gives a lot of weight to the quality of the products and unceasingly seeks to bring into the market products that are up to the standard and meet the consumers’ expectation. For the previous numerous years, the company has been greatly recognized by clients as a result of its outstanding reputation, solid strength, excellent client service, and stringent quality control.



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This paper will focus on China Food Company and specifically will assess the performance of the company over the past ten years (2000-2010) as well as compare this with its industry peers. Besides, the paper will assess the strategy persuaded by China Food Company over the specified period, identifying any key modification in the strategy over the same period. The suitability of the strategy with regards to environmental modifications and changes which have taken place over the period will also be evaluated.

Vision of the Company

The company vision is to become the strongest northern China brand. It has been able to achieve this goal in the Shandong province, and the challenge is to replicate the same in all provinces in northern China and other major cities in the country (Press release 2011). It has taken a lot of efforts and resources to make a basic infrastructure for the operation of the company. Though the company has the most sophisticated and technologically advanced plants for the manufacture of condiments in China, its main focus at the moment is the market with the chief goal of improving consumer's satisfaction and branding (Press release 2011).

The Performance of China Food Company over the Past Ten Years (2000-2010)

Financial Performance

The food market in China continues to expand, and the province of Shandong contributed a whopping 95 percent of the company’s turn over in the financial year which ended 31 December 2010. The Chinese province of Shandong is actually the third biggest province in China based on the gross domestic value. In the last five years, it has recorded an average growth of 20 percent. Looking closely at the performance of the specific business, the condiments business recorded an improvement of about the 17 percent growth rate in revenue and 21 percent profit (earnings before tax) .With the main goal being to develop a northern brand, the opening of the new factory for the production of condiments in 2010, the company’s strategy has being dramatically shifted to focus more on the consumer than the production (Press release 2011). The feed business, on the other hand, grew by about 21 percent in revenue and 60 percent in profit (before tax) .The feed business gross margin is projected to remain low mainly due to the susceptibility of the feed business to external factors including inflation and the global dearth of the commodity.

The company's revenue for the year ended 31 December 2009 was $30.1 and increased to $359 in the year 2010. This represented a 20 percent increase and was mainly attributed to the construction and subsequent commencement of the production of condiments by the new factory. The change of strategy from the over emphasis on the production to the consumer conscious view may be linked to the growth. Within the same period, the company introduced new packaging methods and higher grade products to revamp its Ho Tai brand. A new brand of soya sauces is also in the offing. There was also a big improvement in the company’s operating profit before taxation and costs deductions, from $3.1 million in the year 2009 to $4.0 million in 2010. The company has not also closed its eyes of the increase in the minimum wage and the eminent inflation and continues to reduce the impact it will have on the company’s profitability and growth.

Income Statement for the Year Ended 31 December 2009

  Year ended 31 December 2009 (£) Year ended 31 December 2008 (£)
Revenue 30,136 38,215
Gross profit 6,357 10,765
Profit before tax 2,820 7,506
Net profit 1,708 5,240

(China Food Company Plc. 2009)

The company performance over the last one decade has been gradually increasing. During the financial year ended 31 December 2007, the company recorded total revenue of $25.3 million. This was a 31.1 percentage increase from those recorded in 2006, which were $19.3 million (China Food Company plc. 2007). The percentage increase in profit after the tax was 20.2. This improvement was largely linked with the company’s new acquisition, Full Fortune Holdings Limited. This included even the subsidiary businesses of the company. This necessitated the change of the company name to China Food Company. There was an improvement of the gross margin from 35.1 percent to 31.5 percent. The net profit margin declined from 23.0 percent to 21.1 percent and contributed mainly by the relatively higher corporate overheads used in the preparation of the listing.

China Food Company functions in one of the rapidly growing region in the People Republic of China, where the food industry is mirroring the amplifying purchasing power of consumers in China. This has resulted in the continuous growth in the sales of the company. For instance, in 2006, the yearly sales were RMB 100 billion and increased from RBM 59 billion in 2004. Besides, the amplification was also recorded in 2007 with a growth of about £6.9 billion (China Food Company plc. 2007).

Sales for the Years 2006 and 2007

Year ended 31 December 2007 Year ended 31 December 2006
  Animal feed (£) Condiments (£) Total (£) Animal feed (£) Condiments (£) Total (£)
Segment revenue 13,417,031 11,851,192 25,268,223 10,581,638 8,691,841 19,273,479
Segment result 2,662,366 5,530,260 8,192,626 8,192,626 4,103,417 6,255,863

Financial Performance (2006 and 2007)

  Year ended 31 December 2007 Year ended 31 December 2006 Percentage change
  (£) (£) (£)
Revenue 25,268,223 5,333,243 +31.1%
Profit after tax 5,333,243 4,437,017 +20.2%
Gross profit margin 35.3 % 35.1%  
Net profit margin 21.1% 23.0%  

(China Food Company plc. 2007)

Looking at the specific segment and their contribution, it was conspicuous that the animal feed business accounted for the better part of the group’s revenue in the years 2007 and 2006. It accounted for 53.1 percent of the aggregate turnover. It would be fair to conclude that both groups performed well, and the company’s main aim was to increase the manufacture of condiments to achieve the projected growth. This was achieved through the construction of the factory which commenced an operation in the year 2010. The company had come to the realization that the condiments food business margins were higher as well as achievable and could easily be maintained as compared to other segments. In a nut shell, the company performance was a way above the average, despite the fact that it expenses increased due to the acquisition of the new firm. Its earnings per share for the financial year 2007 were 14.45 pence, that was an increase from the 2006 which was 12.88, a comfortable growth of 12 percent.

The performance of the company is indicated by the identified revenue within the given period, the sales mix, and the working capital ratio. The working capital of the company is calculated independently using the creditors turnover, the debtors turnover, and through examining the inventory turnover. There has been a gradual increase in the inventory turnover over the period, as the company maintained large quantities of raw materials with the expectation that the prices would increase.The Company evaluates the sales demand regularly and makes an adjustment accordingly, depending on the condition of the market (China Food Company plc. 2007). For instance, over the years, the demand for pre-mix feed has been low; and therefore, the company has found it more prudent to engage in the production and distribution of more compound feed whose demand is stable and is always higher than the pre-mix feed. The sales of compound feed in the year ended 2009 was 54,000 tones, which was an increase from the previous year’s sales of 53,000. The sales of the pre-mix feed have been static with no noticeable change.

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Over the last one decade, the performance of China Food Company has been shaped by a number of factors. These have in a big way dictated the extent of production and sales of the company. It is not a surprise that many changes that have been witnessed in the management and operation of the company have happened. The economic climate has been in plain terms unpredictable and which at times go beyond the realms of the company control. Factors such as demand and supply of capital, trends in employment, global economic trends, fluctuations in the rate of currency exchange, inflation rate, industrial disruptions, growth in gross domestic product, interest rate level, market forces, and global as well as regional political events have affected the company’s operations and profitability.

The prices of the raw materials used by the company in its production process have also been changing with time. To be succinct, it has taken an upward trend. The prices of wheat, corn, and soya beans, that are the main inputs in the manufacture of condiments and animal feeds, have been fluctuate mainly due to the changes in market forces of demand and supply. When the supply has been surpassed by demand prices, it means that the company has to use more resources for the production of the same output. As a result, this has affected its profit margin, since the demand of condiments is price elastic and the whole impact and incidence fall on the company.

In the first five years of the last one decade (2000-2010), the demand for high-end products was high, while the demand of low-end product being low. With the change in the economic climate in China, the situation has changed (China Food Company 2007). In the last five years, the demand for high-end products has been low, while demand of low-end products has increased, thus affecting the company’s profit margin and profitability. The condiments and animal feeds market is quite competitive. China Food Company has encountered a great competition from the large films in the industry, which have the capacity to acquire high technical facilities and greater financial resources. This has given the large competitors an edge over the group’s to change the strategy from the production to the consumer, in order to overcome the loss of the market share to competitors and improve consumer loyalty.



Cash Flow

Due to the constrained financial resources, the company issued convertible preference notes worth 1.0 million U.S. dollars. These were mainly subscribed by the existing shareholders. These types of notes carry a coupon rate of 8 percent. By the end of the first half of the year 2010, the company had secured a term loan of 3.0 million U.S dollars from the Bank of East Asia. The company had been able to generate 1.5 million U.S. dollars in the year 2009 and 4.5 million U.S. dollars in the year 2010, from the operating activities (Press release 2011). This signifies an increase in the company’s revenues, and it is an indication that its financial performance is improving. Most of this revenue was used to construct the new factory.


The food company is managed by a board of directors. There are executive directors and non-executive ones. The company is slowly expanding its senior management and staff, as it expands its operations. By March 2010, the company had a total number of 780 members of the staff. The amplification in the number of the staff and the growth of senior management by 2010 can be termed as an augmentation compared to the previous years (2000-2009) (China Food Company 2011). The growth of the company’s management is attributed towards achieving its vision, mission, and objectives as well as making certain that the increased company operations are executed appropriately. It is also seeking to engage more non-executive directors to add to the efficiency of the company and skills. The group has also put in place an executive team that holds meeting on a monthly basis to analyze and review the company execution of the strategy and matters relating to its operation. The executive team comprises of the executive members of the board and the senior local managers.

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Production of Silos

By opening the new factory for condiments production, the company is a few yards ahead of the plan and has been able to fill more than three quarters of its capacity in the stage one. In fact, the company is filling a silo every two days. By the end of 2010, the company had been able to open 16 of its silos and to produce around 1,400,000 liters of soya sauce from the newly established factory (Press Release 2011).

Comparison of the China Food Company Performance with its Peers

There are many companies that can be categorized in the same bracket with the China Food Company. These include, Carr’s Milling Company, Lees Food Company, The Real Good Food Company, and Fins Bury Food Group Public Limited Company (Financial Times 2011).

Comparing the performance of China Food Company with the performance of Carr’s Milling Company, a number of salient features can be analyzed. Carr’s Milling Company is a public limited company based in the United Kingdom (Financial Times Ltd. 2011). The Company has a chain of subsidiaries, which deal with agriculture trading, food, engineering, and manufacturing. The agriculture segment is engaged in the production and the sale of farm equipments, farm consumables, and animal feed. The engineering sections are involved in the manufacture of handling equipment for the use in nuclear firms and researches. The food section is primarily engaged in milling of the wheat into flour. Looking at the performance of the company in the last five years, there was a decrease in the revenue of the company year after year; though, the revenue in 2010 reached its minimum for the last ten years. In 2007, there was $270 million, while 2008, the revenues improved and settled at $380 million. The company turnover for the year 2000 was £97,994, 2001 was £126,684, 2002 was £ 143,378, 2003 was £148,688, 2004 was £155,749, and 2005 was £192,124 (Carr’s Milling Industry plc. 2008). It is true that revenues for the Carr’s Milling Company increased slowly during this period which was attributed by the increased profits for the company. This can be as a result of the implementation of appropriate strategies which matched the environmental conditions of the time.

Though it is evident that the total revenue between the two companies is so different, it is clear that Carr’s Milling Company revenue has been decreasing for the last three years; while China Food Company recorded a growth in revenue of more than 20 percent in the financial year ended 2010. This could largely be attributed to the economic prosperity of the People’s Republic of China over the last one decade. China Food Company sells almost 100 percent of its products in the domestic market, meaning that the improving economic environment augurs well for the company (Press release 2011). On the other hand, Carr’s Milling Company is a global company, and its market is susceptible to changes in the world economic environment, which has not been very favorable. For example, with the recent economic maladies that have inflicted Europe, the company has noted a dramatic reduction in its sales to these countries. This has subsequently been reflected by the gradually reducing revenue.

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Identification of the Strategy Pursued by China Food Company

A strategy is viewed as a game plan for any business, and it is an essential factor as it encompasses management options and alternatives, operation practices and competitive procedures (Luo 2001). The major importance of developing a strategy is to generally change the manner in which a business is operated. Besides, an efficient strategy facilitates a business successful performance of a business and effective navigation of unanticipated obstacles, and competition. Basically, the business strategy assists in defining the aims and organizations of a business, how these can be attained and how this can be made a reality. Businesses implement their strategies from the incorporation of corrective adjustments, evaluated performances, new ideas, changing conditions, and novel opportunities (Grant 2010).

The effective implementation of a strategy in a business is an evidence of success (Lieberman and Montgomery 1988). Normally, an efficient strategy deems how to establish a robust market position. According to the research, the eventual success of a firm or its failure is founded on its strategic move, long-term direction, and business procedures. The main benefit of establishing a strategy in a business is to assist in attaining the targeted outcomes (Lieberman & Montgomery 1988). In addition to this, it assists in reacting the modifying customer preferences and responds to competitive situation as well as market conditions. It is apparent if a business lacks a strategy; it also lacks a roadmap for attracting clients, pleasing the existing ones or for attaining its objectives; and therefore, this implies that the development of a reactive and proactive business strategy is vital for the success of any business (Grant 2010).

Preliminary Strategy Pursued by China Food

The China Food Company has recognized the importance of strategy in its operations. Since its establishment in 1994, the company has employed various business strategies which have facilitated the success of the company. In this case, we will consider the strategy that has been developed by China Food Company between the periods 2000 to 2010. The preliminary strategy of China Food Company was to enlarge its production capability for its products in addition to raising the brand positioning (China Food Company 2007). In order to deal with the company’s production capacity limitation, the board of directors introduced a novel soya sauce factory with a capacity of 50,000 tones and a novel line of production for pre-mix feeds which began operating in 2008. In order to take a complete advantage of the novel factory and the company’s choice of products, a procedure of brand positioning was initiated by the group. The procedure encompassed amplifying prices, revising the marketing, advertising strategies, and redesigning the packaging of the products. Besides, the company aimed at strengthening the sale and marketing group as it anticipated for regional expansion. China Food Company initial strategy of focusing on boosting production capability was aimed at maximizing the profit and the revenue generation from their subsisting production facilities and preparing the market for the novel premium products to be generated from the new factory (China Food Company 2007).

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Generally, the initial strategy of the company was production based. Primarily, China Food Company focused on increasing its production capacity in order to serve a wider geographical area. This was followed by a need to cut various costs in order to attain its objective of increasing revenue and profit margins. These encompassed production costs and retaining a minimum number of staffs in order to cut on labor expenses. Although this strategy was convenient during the years 2000 to 2006, the financial crises of 2007 necessitated the company to modify its strategies in order to cope with the then economic environment.

Major Changes in the Strategy

In 2008, China Food Company changed its strategy, in order to take advantage of the country’s economic growth. Certainly, China established itself as an international economic power in 2009 with a Gross Domestic Product growth of 8.7 percent. The strong growth in China economy even when many nations were challenged by the 2008/20009 financial crises gave many businesses both in China and across the world a possibility to take advantage of the same. Specifically, China Food Company is in a high position to gain from the general growth of the Chinese economy (China Food Company plc. 2009).

The opening of the novel condiment factory shifted the importance of the company strategy from being centered on the production capacity to being consumer focused. The modification of China Food strategy was to meet the contemporary needs of the consumers by serving them with quality and standards products. This is a great measure, and it is very essential especially in the rapidly changing environment with the increased competition and identifying that customers are core to the success of any business. Through strengthening the marketing group and investing in brand building and establishing novel markets, China Food will be able to meet the needs of its already established and new customers (China Food Company plc. 2009). With an aim of benefiting from the strong economic growth in China, China Food Company pursued a number of fundamental strategies as explained herein.

Northern China Strategy

The operations of China Food Company are located in Northern China. The region has a population of around 94 million people. The company’s success is a result of its focus on various components of its operations that include:

  • Amplifying the range of its products, with the sale of novel products including olive oil, in addition to introducing global brands in the market.
  • Distributing the company’s products based on markets and channels, building on subsisting linkages with supermarkets and distributors in China, whilst at the same time, increasing its operation outside the province of Shandong.
  • Logistic distribution of the company’s products through the capitalization of the country’s amplified expenditure on infrastructure.

(China Food Company plc. 2009)

The Shandong province is the largest market for China Foods Company’s product. The province has a population of about ninety four million people with more than 89 percent of the revenues coming from sales in the location (Financial Times 2011). In order to add to its capacity, China Food has expanded its market in Hebei and Henan. These factories in these two provinces initiated their operations in 2010. The strategy of China Food Company is to center its endeavors on satisfying the increased demand of its products in these two provinces amongst other provinces in China. Besides, China Food Company has been centering on discovering the probability of sourcing global products that can be represented by the company in China in addition to exploiting the widespread distribution networks of China Food Company in Shandong and the related provinces.

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Operating on High Global Standards

It is apparent that in order to efficiently function in the international marketplace, the company necessitates taking into consideration international standards rather than merely focusing on local standards in China. In the years 2007 and 2008, China Food Company made stronger its monitoring systems and financial control, put into practice superior corporate governance and looked for professional aid to enhance its business procedures. Although the company is certified locally by ‘ISO9001 quality management systems’ and the ‘Hazard Analysis and Critical Control Points’ (HACCP) safety systems that are upheld by the global association for standardization, a global certification group has the responsibility of re-auditing China Food in order to make sure that it obtains global accreditation (China Food Company plc, 2009).

China Food Company is dedicated to enhancing its standards and quality. With an aim of making certain that this is attained, the company board appointed a quality director who was given the responsibility of implementing the same. The company abides by the stringent food safety standards in China, which are deemed to be stricter compared with the global standards. Basically, this is as a result of the food safety problems which cropped up in 2008 and due to the safety laws that were passed in 2009. According to the China Food Company, maintaining high standards of the general corporate governance is significant to its growth, enhancing the performance as well as capitalizing on continuing shareholder value. In addition to this, China Food corporate governance activities and procedures agree to the guidelines and values of the ‘Quoted Companies Alliance’s Corporate Governance’ with the intention that the company abides by these global guidelines (China Food Company plc. 2009). According to studies, a good corporate governance assists companies to prevent corruption in management levels as well as to promote the value of the company, the creation of value for the shareholders and alleviating the financial and investments risks that may affect an organization. For this reason, healthy, sound and good policy framework for corporate governance is very essential whilst investing in a company. Besides, corporate governance ensures that a business is directed and controlled responsibly, professionally, and transparently in order to make its long-term success more secure, whilst at the same time, it improves relations with workers, creditors, and other stakeholders.

Development of People and a Focus of Sales and Marketing

Certainly, the development of people and focusing on sales and marketing are some of the main factors that companies should consider in order to ensure their growth. China Food Company has made these as part of their strategies in order to attain their objective of being client focused. Since the year 2000, China Food Company has taken various steps to ensure development, and this includes its move in 2009 of expanding its businesses to various provinces in China and the recruitment of a marketing director who will be responsible for driving growth to the company’s main target markets. The company has increased its workforce from approximately 200 in 2000 to more than 600 in 2009, and aims at developing and supplementing these employees in order to attain its vision of becoming the principle food company in China with the international standards. This includes the promotion of individuals who have worked in the company for more than ten years to the levels of management. With an aim of supplementing the staff, the company issued approximately 4,648 share options to around a quarter of the employees. This is aimed at encouraging loyalty from the workers, rewarding them, as well as distinguishing their optimistic contributions. China Food Company has dedicated and extremely qualified personnel, and the board usually reviews key essential skills necessitated by the company as it continues to grow and develop. These skills are introduced to the company by employing global managers. The Company staff plays an essential responsibility in its success, and this is significance in the strategies implementation developed by the company, which aims at taking China Food to the subsequent level of the corporate development.

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Animal Feed Business

By 2010, the animal feed business has achieved amplified momentum compared to the previous years, and it is evident that its pace of growth is also increasing especially with the appointment of a novel general manager. To a certain level, the business relies on livestock prices, and this signifies that their increase will result in the company expanding its production. The China Food Company strategy is to center mainly on pre-mix feed. In 2009, the company launched its novel website which highly focuses on catering for the requirements of the investors.

Summary of the Past and Future Strategies

It is true that the economy of the People Republic of China will persist to grow and develop, and this implies that its citizens will be wealthier. With an aim of maximizing this growth, China Food Company has divided its strategy into:

  • Maximizing the novel soya sauce facility that was opened formally in 2010 and the manufacture in this facility has already started. The research indicates that the production capacity of China Food was amplified by fifty percent.
  • Establishment of novel markets. The company’s biggest market is the province of Shandong. However, in order to maintain and improve the performance of the company, the board persists in benefiting and expanding its market to the nearest provinces including Henan and Hebei, as there are sufficient products from the novel factory to meet the demand in the new markets.
  • China Food Company considers the probability of sourcing global products that can be represented by the Company in China and that can assist in establishing the Company’s wide-ranging distribution network.
  • Lastly, China Food Company centers on amplifying the range of products produced by the company in addition to product distribution in regard to market and channels, and product physical distribution.

The Appropriateness of that Strategy in the Light of the Environmental Pressures and Changes that Have Occurred over that Period

Certainly, there are numerous environmental pressures and changes which affect the way a business is performed. Most businesses fail as a result of these pressures; while others cease their operations. Environmental pressures and changes usually impact the strategies implemented by a business, therefore, making it difficult to achieve their set goals and objectives (Afuah 2009; Hitt, Ireland & Hoskisson 2010). As a result, these pressures and changes necessitate businesses to take appropriate measures in order to overcome the same, and thus, they remain and maintain their success in the market. Besides, efficient measures for unforeseen events necessitate to be put in place in order to protect a business in case such events take place. In the contemporary society, there are various environmental pressures and changes that influence the functioning of a business. These encompass economic, political, legal, social and technological pressures as well as the competition from peer industries (Armstrong & Kotler  2000; Xu 2005). These factors form part of the macroeconomic factors that affect businesses.

The political environment in the People Republic of China has been very favorable for the operations of businesses (Ambler, Witzel & Xi 2008). This implies that there has been political stability which has offered a favorable environment for the functioning of various businesses, including China Food Company. This implies that the various strategies that were implemented by the company between the years 2000 to 2010 were not swayed by any political imbalance; and therefore, the company was able to attain its set objectives.

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Initially, China Food Company strategy focused on increasing production capacity. This strategy was deemed appropriate for the economic environment of the country at the time. China had not grown largely in terms of the Gross Domestic Product (GDP), and as a result, pursuing the strategy of increasing the company’s production capability with the purpose of meeting the demands of various newly established markets was deemed suitable (Ambler, Witzel & Xi 2008). The aim of this was to capitalize on revenues and profits by serving a large group of customers. Moreover, China Food Company considered the probability of sourcing global products that can be represented by the Company in China and that can make use of the Company’s wide-ranging distribution network. The aim of this was to meet the growing demand of its new markets in order to maximize the company returns.

In terms of the economic environment, China as a country has grown very rapidly. In fact, currently, China is one of the most developed countries competing with various giants like the United States (Yeung 2007). China Food Company changed its strategy in 2008 in order to take advantage of the country’s economic growth. Certainly, China established itself as an international economic power in 2009 with a Gross Domestic Product growth of 8.7 percent (Ambler, Witzel & Xi 2008). The strong growth in the China economy even as many nations were challenged by the 2008/20009 financial crises gave many businesses both in China and across the world an opportunity to take advantage of the same. Specifically, China Food Company is in a high position to gain from the general growth of the Chinese economy.

The opening of the novel condiment factory shifted the importance of the company strategy from being centered on the production capacity to being consumer focused. The modification of China Food strategy was to meet the contemporary needs of the consumers by serving them with quality and standards products. This is a great measure, and it is very essential especially in the rapidly changing environment with the increased competition and identifying that customers are core to the success of any business. It is obvious that the current strategy of China Food Company of Focusing on consumers was very suitable during these years in that growth in economy means that the populace becomes more affluent. Providing high quality products to these customers means that there is a high probability of the customers purchasing the same, resulting to the increased sale, and therefore, profits and revenues (Kotler & Kevin 2006). According to the research, customers go for quality products irrespective of price, thus focusing on customers with regards to serving them better and offering quality products is a prerequisite for the success of China Food Company (David 2010).

The competitive environment is a market pressure that continues to grow especially in the current environment (Boone & Kurtz 2012). There are various industry peers functioning in the market, and they can be treated as a great threat to China Food. These encompass Carr’s Milling Industries plc, Finsbury Food Group plc, Thorntons plc, Lees Food plc, Zetar plc, the Real Good Food Company plc, and Wynnstay Group plc amongst others. The modification of the China Food Company strategy from amplifying production capacity to being customer focused is very appropriate in that in itself, the strategy can be deemed as offering the company a competitive advantage over its peers. Knowing the company’s customers, their needs, and attempting to meet their demand and satisfying them entirely are a prerequisite for success (Campbell, Stonehouse & Houstone 2002 Capon 2008). It is true to say that the change of China Food strategy is a main factor that has accelerated the growth of the company up to date, and it has enabled the company to increase its revenues and profit margins since 2008, as compared to how the company performed in the early 2000’s.

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Assessing the performance and strategies employed by a company is a crucial thing especially in the contemporary society that is characterized by the increased environmental and market pressures. Nowadays, companies are implementing what they deem as efficient strategies in order to triumph over these increased pressures. This paper has focused on China Food Company, a public limited company with its key operations in China, and subsidiaries in various countries including the United Kingdom such as Fuss Feed Co., ltd., Full Fortune Holdings pte. ltd., and Shandong Fuss Biotech Co., ltd amongst others. The company deals with the production of various products which are divided into animal feed and condiments. The wide array of products generated by China Food is sold via a network of outlets and distributors including Walmart, Tesco, Jialejia, and Carrefour.

The performance and strategies employed by China Food Company between the years 2000 to 2010 are the main focus in this paper. Through the assessment, it is clear that the performance of China Food in terms of financial and operational have improved for the given time period. The company’s revenues and profitability have continually grown, and this can be linked to the various strategies being employed. For instance, when the company was pursuing the strategy of amplifying its production capability, in the early 2000’s, its main objective was to capitalize the revenues and profits which it had achieved. Besides, the change of China Food strategy in the late 2000’s to focus on its consumers was aimed at taking advantage of the rapid economic growth of China in order to maximize the profits. The company aimed at providing quality products to its customers and developing its employees in order to offer best services to the customers.

In the current economic and competitive environment, focusing on your customers and understanding their needs are very essential for success. Certainly, the various strategies pursued by China Food Company were appropriate for the time as they took advantage of the economic environment of the time, and besides, they were able to overcome the environmental pressures and changes experienced as well. Nevertheless, it is essential for the company to focus on the research and the development in order to provide the best offering to its customers. It is true that the research and the development are major factors that should be put into consideration by companies that want to prevail in the market (Boone & Kurtz 2012).


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