Aloha Case Essay
ACC3602 Managerial Planning and Control Systems
1. What should be Aloha's competitive strategy?
It is difficult for Aloha to compete with the industry giants like Nestle, P&G and Phillips Morris on low cost. The reason is simple - volume. These industry giants have much higher volume than Aloha and enjoy a tremendous advantage in economies of scale. It is probably suicidal for Aloha to try to adopt a low cost strategy. It will probably be crushed like an ant, unless the giants play “oligopolists” and charge high prices to maximize profits.
Differentiation; i.e., selling gourmet coffee a la. Starbuck?
It is probably easier for Aloha to position itself as a gourmet coffee …show more content…
If the purchasing department is evaluated this way, the department has nothing to gain by transferring high-priced beans to the roasting plants and keeping low-priced means to themselves, and therefore will cease to do so. But the purchasing department should not be given unlimited freedom to trade on the forwards market; they should not be like Nick Leeson and allowed to bring the whole company down by excessive