Case Study: Braum's Incorporated

Braum’s Incorporated is a vertically integrated company, owns multiple segments of the industry and merges them together, which allows them to produce their products with the quality and standards they want. The corporation produces meat, dairy products, fruits, and vegetables. They have 280 stores located throughout Kansas, Texas, Missouri, Arkansas, and the majority located in Oklahoma, where their headquarters are (About Us 2016). The chains of stores located in these areas provide hamburgers, ice cream, and a small grocery store for their customers. Although Braum’s provides all of these commodities they are mainly known for their ice cream.
Braum’s produces many products due to it being a vertically integrated company. For simplicity, …show more content…
When it comes to the decision of the consumer as to what to purchase multiple factors come into play such as, the prices of the goods, the consumer’s budget, and how much satisfaction (utils) the consumer will receive from purchasing an item. Also, when deciding as to what business to purchase from it depends on the consumer’s preference, for instance, some consumers may prefer Braum’s ice cream to Blue Bell Creameries since Braum’s does not use artificial flavors. Another reason that a consumer may receive more satisfaction from eating Braum’s ice cream is because they are aware that the ingredients for their ice cream came from Braum’s dairy farm, which may be a factor for a consumer that gives them more satisfaction. However, there are constraints that can come into play that can affect a consumer’s decision such as a consumer’s budget. For example, if a consumer prefers Braum’s ice cream over Blue Bell Creameries, yet the closest place they can get ice cream is Blue Bell Creameries they may settle to go to Blue Bell Creameries since they cannot afford the fuel to travel to Braum’s. Another factor that comes into play when a consumer is deciding on what company to purchase ice cream from is if one company provides a good that the other does not. For instance, Braum’s provides many flavors of ice cream that Blue Bell Creameries does not, allowing Braum’s Incorporated to have more control over their prices since a consumer is not able to find a perfect substitute for that product at another company. This allows Braum’s to have an edge over their competition since they do not have to worry about consumers going to other businesses looking for the same good for a cheaper price. This also allows Braum’s to provide a good that other competitors are not, which results in them making more profit and attracting more customers.