Brazilian Orange Juice Industry: Dealing with Global Threats and Opportunities
Name
University
Brazilian Orange Juice Industry: Dealing with Global Threats and Opportunities As the world's top producer of orange and orange juice, Brazil's orange juice industry is facing diverse threats that affect consumer demand and in turn, corporate revenues. Gallas (2017) reported the falling production of and demand for orange juice. To understand existing internal and external variables shaping the business, the paper presents PEST and SWOT analyses, the issue and problem statement, as well as the alternative strategies, recommendation, plus lessons learned.
PEST and SWOT Analyses PEST analysis reveals the threats to and opportunities …show more content…
The strengths of the industry are its global dominance and production system. Approximately 50% of orange juice came from Brazil (Gallas, 2017). At the same time, a citrus tree illness in Florida cemented Brazil's global domination (Gallas, 2017). Furthermore, the industry has factories all over the world which reduces the risks of depending on one manufacturer only (Gallas, 2017). The dominance of the industry discourages new players to enter and compete efficiently (Gallas, 2017). Despite these strengths, the orange juice industry has the weaknesses of overdependence on the export market, lack of an aggressive promotion, and low production. More than 95% of orange juice is shipped abroad which makes it prone to exchange rate and inflation fluctuations (Gallas, 2017). In addition, for the past decades, the healthcare industry has tainted orange juice as an unhealthy as carbonate drinks due to the high sugar content, especially for commercially-packed juices (Brodwin, 2018; Morris, 2017). Instead of promoting that orange juice has a higher nutritional content than soft drinks, the retaliation is weak. Finally, orange production is falling as some Brazilians who have orange orchards have shifted to lemons and guavas (Gallas, …show more content…
The biggest threat appears to come from changing breakfast and juice-drinking habits. More people are skipping breakfast altogether or making shakes from vegetables/fruits on their own or buying them from nearby beverage stalls and supermarkets (Terazono & Hume, 2106). In addition, as the demand for orange juice declined, coconut water experiences a demand surge because healthcare professionals recommend it as the best drink after a workout while also emphasizing its low sugar and high nutritional content compared to juice drinks (Terazono & Hume, 2106). While breakfast and juice threats exist, opportunities are also present. China is a large market that the industry can tap through a joint venture with popular beverage companies. Added to this is beverage demand from children and teenagers that can be increased through the right marketing
Name
University
Brazilian Orange Juice Industry: Dealing with Global Threats and Opportunities As the world's top producer of orange and orange juice, Brazil's orange juice industry is facing diverse threats that affect consumer demand and in turn, corporate revenues. Gallas (2017) reported the falling production of and demand for orange juice. To understand existing internal and external variables shaping the business, the paper presents PEST and SWOT analyses, the issue and problem statement, as well as the alternative strategies, recommendation, plus lessons learned.
PEST and SWOT Analyses PEST analysis reveals the threats to and opportunities …show more content…
The strengths of the industry are its global dominance and production system. Approximately 50% of orange juice came from Brazil (Gallas, 2017). At the same time, a citrus tree illness in Florida cemented Brazil's global domination (Gallas, 2017). Furthermore, the industry has factories all over the world which reduces the risks of depending on one manufacturer only (Gallas, 2017). The dominance of the industry discourages new players to enter and compete efficiently (Gallas, 2017). Despite these strengths, the orange juice industry has the weaknesses of overdependence on the export market, lack of an aggressive promotion, and low production. More than 95% of orange juice is shipped abroad which makes it prone to exchange rate and inflation fluctuations (Gallas, 2017). In addition, for the past decades, the healthcare industry has tainted orange juice as an unhealthy as carbonate drinks due to the high sugar content, especially for commercially-packed juices (Brodwin, 2018; Morris, 2017). Instead of promoting that orange juice has a higher nutritional content than soft drinks, the retaliation is weak. Finally, orange production is falling as some Brazilians who have orange orchards have shifted to lemons and guavas (Gallas, …show more content…
The biggest threat appears to come from changing breakfast and juice-drinking habits. More people are skipping breakfast altogether or making shakes from vegetables/fruits on their own or buying them from nearby beverage stalls and supermarkets (Terazono & Hume, 2106). In addition, as the demand for orange juice declined, coconut water experiences a demand surge because healthcare professionals recommend it as the best drink after a workout while also emphasizing its low sugar and high nutritional content compared to juice drinks (Terazono & Hume, 2106). While breakfast and juice threats exist, opportunities are also present. China is a large market that the industry can tap through a joint venture with popular beverage companies. Added to this is beverage demand from children and teenagers that can be increased through the right marketing