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Dakota Growers Pasta Competitive and Industry Analysis By The Management Team College of Business Administration and Public Policy In partial fulfillment of the requirements of Strategic Management Seminar Instructor March 23 2005 MEMORANDUM TODakota Growers Pasta FROM SUBJECT Competitive and Industry Analysis DATE March 23 2005 Managements success is determined by building an understanding of the firms industry and matching its strategy to changing conditions and competitive realities Industry and competitive analysis aims at developing insightful answers to seven questions 1What are the industrys dominant economic features 2What is competition like and how strong is each of the competitive forces 3What is causing the industrys competitive structure and business environment to change 4Which companies are in the strongestweakest positions 5What strategic moves are rivals likely to make next 6What are the key factors for competitive success 7Is the industry attractive and what are the prospects for above-average profitability The Pasta industrys dominant economic features are market size and growth the number and relative size of both buyers and sellers whether sellers are vertically integrated the extent of scale economies changing technology and whether the products of rival sellers are standardized or differentiated There were 13 major companies that milled durum wheat in the United States The use of lower cost technology had eased the way for new entrants into the pasta industry and had brought product innovation The industrys revenues were valued at 26 billion There were four principal dry pasta market segments ingredient 43 percent private- and brand-label retail 37 percent of the market food service 10 percent and government bids 10 percent Within each segment there were both private-label and brand-label products Competitive forces help pasta producers identify and measure the strength of competitive pressures that exist and gain understanding of the industrys whole competitive structure Competitive forces shaping
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