Professional Documents
Culture Documents
Strategic Analysis BRF Foods Vfinal
Strategic Analysis BRF Foods Vfinal
BRF Foods
Bukola Ifeoluwa Jaiyesimi
Letícia Franco Martinez
Vitor Nardini Marques
1
Agenda
2. External analysis
5. Recommendations
1. History of the company
80+ years 5+ million tons
of history and tradition in
of food produced/year
the Brazilian market
Owner of the
most valuable
food brands 1
1
Largest exporter
of chicken in the world
1
in Brazil 5
1
1
producer
5
50+ plants 1
1
1
20
Largest producer
40+ distribution 8
9 2 of pork, turkey and
International Operations
centers in the world,
3
chicken in Brazil
Productivity units
Source: BRF Foods October 2018 presentation based on Watt Global Media (2015) 3
1. History of the company
Sausages
Margarine
Vision: Making BRF the Most Inspiring and Important Global Food Company
Sadia became the leader Perdigão became a Sadia opened it doors Sadia launched the Qualy
among national exporters pionner in exporting around the world. brand.
to Middle-East. Brazillian chicken meat to
Saudi Arabia.
2. External analysis
5. Recommendations
2. External Analysis
Supplier Power
Buyers Power
Source: Porter
2. External Analysis - Rivarly of Competitors
Main Competitors Another Competitors
Cooperatives Companies
+ Local producers that operate in informal market with lower quality and prices
Marketshare of BRF
in 2018
Average 4.0
2. External Analysis – Supplier Power
*Possibility of replacing
High 1
Swine suppliers' products
*Degree of importance of
Very high 0
✔ 3,100 production farms your company to suppliers
✔ 15,000 fattening farms Costs involved in changing
Very low 1
supplier
*Indicator with inverted score.
System of Integrated Producers Average 0.5
*Integration among
Medium 3
suppliers
Capacity to determine the
Medium 3
prices
= Represent 35% of revenue *Indicator with inverted score.
Average 3.6
*Valorization of current
Very high 0
brands
*Indicator with inverted score.
Average 1.4
Competition from
Supplier Power
Substitutes 3.8
0.0 0.5
1.4
Threat of New 3.6 Buyers Power
Entrants
Agenda
2. External analysis
5. Recommendations
3. Internal Analysis and Financial Situation
Source: Investing.com
Agenda
2. External analysis
5. Recommendations
4. Identification of the core strategy
4. Identification of the core strategy
Question 1: What is “the core” of the business?
What are the business’ Who are the business’ core What are the business’ cost What are the business’
core capabilities? customers? advantages? core products/services?
• Innovation: strong • B2B: bakery, • Competitive advantage • BRF has a big
brands, committed - producers located in diversification (Sadia,
restaurants, Perdigão, Batavo,
people and a robust some international
supermarkets and markets (lower Elegê, Qualy, Cotoché,
and flexible operation; other retailers. Perdix)
production costs and
efficiency gains in animal • Sadia and Perdigão are
• Governance: Ethics, production in Brazil; the most important
integrity and • Scale/Quality: brands
leadership -compete effectively with - Sadia bet on the “ready
development; the main producers dishes” (lasanna,
• Programs designed to stroganoff)
improve cost efficiency - Perdigão bet on “built-in
• Quality in all - Streamline supply products”: the pepperoni
processes, products chain, integrating sausage as a leading
and relationships; demand, production, product
inventory management
and customer service.
4. Identification of the core strategy
Question 2: What are sources of full potential to “deepen” the core?
Strategic Operational Organizational Financial
- Pillars of corporate - 440 thousand monthly - 3.4 thousand people - R$ 684.6 million were
culture, quality, deliveries to customers involved in discussions invested in 2017,
innovation, branding, in Brazil of attributes and focusing on the growth
and e-commerce - Smart packaging commitments of production and
- 150 countries - Have sales teams - 89% of employees efficiency
- + de 220 million directed to each client declared themselves - Restructuring plan: (i)
custumers (bakery, supermarkets) engaged divestments in Europe,
- + 40% of the - Technology in the whole - 17.80% was the Thailand and Argentina;
international sales process turnover rate in 2017, (ii) sale of non-operating
volume comes from own well below the 28.21% assets; (iii) better
- Sustainability management of working
distribution rate recorded in 2015
- Transparency channel capital, mainly frozen
- 58 own factories in 9 raw material and
countries finished product stocks;
- + 4 thousand SKUs and (iv) securitization of
adapted to the receivables
characteristics of each - Expects a cash injection
region in which they of. approximately R $ 5
operate billion
4. Identification of the core strategy
Question 3: What adjacencies should we extend into?
Some Recommendations
• New market opportunities:
• Opportunities for growth in the Middle East – with diversification of products in Saudi Arabia and
Turkey;
2. External analysis
5. Recommendations
5. Recommendations – Future Scenario
Data driven framework for adapting to changes over mid and long term
Uncertainty Response
Risk
health risk, recall off tons of chicken, animal disease
outbreak, cross border operation risk. Forecast based on historical occurrences
Structural uncertainties
Trade barriers, government policies, chinese government anti Multiple scenario based planning which takes into
dumping investigation, pressure from local producers, Saudi consideration the range of uncertainty
Arabia’s no stunning requirement.
Unknowables
“Carne fraca” operation, “Trapaça” operation, rapidly Develpop perceptual skills to ensure rapid and improved
changing digital environment, emerging markets. reacting skills.
5. Recommendations
Strategic Projects:
1. Grow in the Middle East –diversification of products mainly in Saudi Arabia
and Turkey;
2. Increase the portfolio in healthy food;
3. Create product line based on vegan, vegetarian and allergics;
4. Grown the business of ingredient in animal nutrition;
5. Create iniciatives for food service or direct distribution.
Attention Points:
▪ In-depth analysis of stakeholders and shareholders (Beware of scandals:
“Operação Carne Fraca”);
▪ Strategic Talent Management
Thank you