Company analysis of NUMICO

Company analysis of NUMICO NUMICO came into existence in the year 1896 when Mr Martinus van der Hagen secured all rights of a formula for infant milk from cows milk. His operation was based in The Hague in The Netherlands. In 20th century company changed the named to Nutricia but in the year 1997 when company received the designation Royal then its name changed to NUMICO NV. Recent Past of NUMICO: Strategic Corporate Development History For nearly 5 decades NUMICO worked with corporate strategy of trying to build themselves on only one baby product with limited exports. In 1946 company introduced another product but in the local market only. NUMICO for a long time tried to develop the new strategy after their first initial success in 19th century. Launching new product was not a brilliant idea though it was a sustainable decision. Usually companies spend millions of dollar developing the product and this would take some years to recover. As product development was not enough to grow in multiple folds so company made many acquisitions in different geographies. The result at the end of year 2006 was NUMICOs presence in more than 100 countries with plethora of products to sell. Products were bifurcated among different divisions like clinical nutritional products went under brands such as Nutrison, peptisorb etc. Revenue and profit margin both increased because of acquisition. Acquisitions can get a limited and desired level of success and to keep growing even NUMICO invested heavily in research development. Strategic alliance with industry giants, universities and government helped NUMICOs cause. Research development wing of NUMICO attracted the best and on a regular basis filed for the patents. NUMICO Acquisition strategy in 1998, 1999 2000 To exploit linkages between the organisation and its environment NUMICO adopted Medical Platform Marketing. NUMICO moved from supermarket shelves to practitioners clinics. Now, products for vulnerable people were prescribed by doctors. Expenses on research and development were forcing NUMICO to reach new places to recover the cost. In 1998 annual report NUMICO was a multinational company focusing on the development, production and sales of nutritional medical concepts with a great value addition. Strategy of NUMICO as per annual report of 1998 mentioned in the case study* by Eppink was as follows: The strategy of NUMICO is focused on specialisation, continuing internationalisation and profitable growth, partly by acquisitions as wll as by strategic alliances, and safeguarding the highest quality in all stages of production and services. As per the turnover in 1998, NUMICOs major revenue generating business still was infant food which was sold maximum in Western Europe which was experiencing the major falling birth rates and an ageing population. After analysing the market NUMICO bought few European companies to expand in profitable areas. In 1999, NUMICO acquired a company bigger than them in terms of production revenue. When NUMICO bought General Nutrition Companies (GNC) of Pittsburgh (USA) it was the largest manufacturer of nutritional product in the world with a stronghold in sports-nutrition market. It was a win-win situation for both the organisations where GNC was gaining from NUMICOs research to enhance their product range NUMICO could gain from the distribution network of GNC. Press release explained the reason of this acquisition which was to achieve the global market dominance.1 Acquisition was on the cards for the third year as well when NUMICO snapped Enrich International Rexall Sundown in 2000. Unlike GNC Enrich was in the business of nutritional supplements personal care products with an in house RD department for product development. Again unlike GMC, Enrich was in 10 more countries with a global distribution system. Rexall Sundown another US based organisation was acquired by NUMICo. Rexall like Enrich was a producer of nutritional supplements as well as consumer health products. NUMICO acquired another business which has got nothing to do with their main business interest like GMC. A press release describes the reason of acquisition which was again to get the pole position in the market.2 Acquisition of new businesses far from NUMICOs main business made NUMICO its own rival because NUMICO already had the presence in the market. However, Rexall could exploit the European market because of NUMICOs distribution network present in Europe. At this point in time, NUMICO was confused in their approach because two competitors (Enrich Rexall) were working under one roof and serving the same market. Strategist might have analysed the more competition less co-operation among the two brands. To make operation smoother and to serve their customers better NUMICO merged the Enrich Rexall in one new separate entity by the name Unicity. Strategy evaluation: From day one and for a long period of time NUMICO operated with one product because of which they never realised their potential as a standalone entity to grow. After not getting desired success till the end of 20th century NUMICO realised alone they cannot get the global position in market. At this position, they might have done PEST analysis to judge the environment affecting them. Even SWOT could be used as a tool to know the strong areas where they can build the future empire. PEST might have shown them that they are not functional in future markets where they can grow faster than their current strong hold markets like Western Europe. PEST can cover issues from demography to social technological changes like declining birth rates to e-commerce. By applying SWOT, one can know that NUMICO always regarded the RD as an important activity which they wont give up at any cost. Thus, they identified RD was their strength where they can build their future. Michael Porters 5 forces theory could have also applied in this case study to know why NUMICO only adopted the acquisition route. As the case study explains NUMICO was operating in such an environment where the small players could have changed the entire game. The threat from existing players and new comers was massive moreover small players were taking the competition to all geographies. Hence to enhance the global position in the market NUMICO adopted the acquisition route. Acquiring GMC was a sensible move it was reducing the competition and on the other hand it was enhancing the performance but acquiring Rexall Enrich was not at all a brilliant move. Reason being, it stretches the operational efficiency because NUMICO was not in the same domain with them. *case study (Do the Harvard referencing because I am not aware of the source) 1) Just the last line need referencing from the case study. 2) Press release in the case study Current Strategic Situation: Acquisitions in a field which was not related with their main business interest left them in a position between the pharmaceutical market and the food market. To avoid the stuck in the middle situation usually organisations adopts the Michael Porters (1998), generic strategies which is as follow: Figure: Competitive advantage Source: tutor2u.net (Accessed on: 20/03/2011) Cost Leadership: In this strategy, organisation aims to be the lowest cost producer to gain the maximum share in the market. To achieve this position organisation drive the cost down through sourcing the cheapest raw material labour cost. NUMICO was not trying to achieve the cost leadership because case study shows that they were aiming for high margin business. Hence, cost leadership is not NUMICOs domain. Differentiation: As the name suggests, in this strategy, organisations aim to be different from their competitors. Differentiation provides a competitive advantage to organisations which helped them to charge a premium price for their products services. If we look at NUMICO case study we will find that they started with one product due to patents they held the ground for long time. One product was sufficient with a patent to create the differentiation but later they acquired so many organisations which could provide them distribution network penetration in the foreign market. Acquisition which they made was not only in their own domain and at this point they started losing the gained differentiation. From super stores shelves to general practitioner prescription, move was certainly adopted to make a differentiation but due to diversified businesses it confused the distribution points. Differentiation did not pay off well because by 1998 their major revenue generator was still infant formula. Niche strategies: Here the organisation function in one specific segment and try their best to become the best provider of products services. To work in this kind of strategy organisations need to be either cost efficient or different from other players like Rolls Royce in the car market. NUMICOs acquisition exercise took them into various domains but still they tried to call themselves a Medical Platform Marketing. One platform for medical assistance to those who are vulnerable didnt work well because of plethora of products. However, from NUMICOs perspective they focused on specialisation with profitable growth. STUCK IN THE MIDDLE: NUMICO got involved in series of acquisition related unrelated to their main business interest because of which they are facing the stuck in the middle situation. To simplify the situation they tried to bring all the diversified business interests under one roof. Things are still confusing because they wanted to build on nutritional field but due to acquisitions they are working in nutritional supplements fields as well. Moreover, they acquired two competitors (Enrich Rexall) and left them in the field to compete with each other. It took some time to bring both of them under one brand name and by that time both of them did enough damage to each other. Now, NUMICO is stuck between the pharmaceutical market the food market because of their confused approach. Lot of unwise decision made which resulted in head on collusion with giants of pharmacy food business like Novartis Nestle. NUMICO always wanted to sell clinical diet foods but because of their acquisitions they are not focusing on their main stream business. NUMICO bought the US operations not to sell what they were doing before acquisition e.g. vitamins. Rather than turning them into NUMICOs regular business NUMICO started looking after their operations. First an industry expert noticed that NUMICO is facing challenges because they are not performing only in their traditional markets. Company was stuck in the middle because it was facing challenges from giants minnows at the same time. New markets where they were operative due to acquisitions were full of small players. In addition to that threat from new entrants was massive. NUMICOs strategy needed a review before they lose the global position. Strategy review: In the year 2000, NUMICOs board of directors recognised the risks from existing strategy. NUMICO due to acquisition was not paying enough attention to their cash cow i.e. infant products and now strength of NUMICO is making them vulnerable. NUMICO is a European organisation they maintain balance sheet in euro and any PEST affect in USA operation can cause serious problem to their business figures. Operation overseas involves exchange risk as well. Last but not the least even NUMICOs board realised that they are confused in approach. NUMICO was not all stuck in the middle because organisations who face this kind of situation usually subject to a takeover or merger. Finally when NUMICOs board realised the drawback associated with the strategy they should take this opportunity to reduce or eliminate the risk. Strategy review due to certain events: In the year 2001, after 1 year of realisation, company saw themselves in hot waters due to economic slowdown in the USA. In addition to slowdown, demand for nutrition herbs were plummeting too with an increased competition from low price manufacturers. Its not only NUMICO which was facing the heat but the whole sector was losing the effectiveness. If NUMICO would have done the PESTEL analysis then they could have avoided this slowdown and competition because they never saw this slowdown coming into the picture. It is necessary to explore the competitive environment to develop sustainable competitive advantage. NUMICO response to events: NUMICOs response to the situation was not at all proactive. NUMICO response was reactive that to after negative growth. CEO was asked to mind the traditional new business but not to take any other big projects. US operations gave back to back management problems to CEO which resulted in his resignation in May 2002. New CEO bifurcated the operations in three divisions and for the first time they adopted a specific approach to tackle each brand. In other words, NUMICO changed the corporate strategy to unit level strategy to take care of each business. In the year 2002, NUMICO got bad news from all the quarters of business and to make the situation worse exchange rate of US dollar was changing frequently against euro. Finally, NUMICO announced the sale of Rexall Sundown GNC to focus on high-growth/high-margin businesses of baby food and clinical nutrition. Both the brands increased the performance of its new owner. Strategic Direction for the future: After divestment, NUMICO should think about the future. Company can use BCG Matrix to determine what is to be done to remaining product portfolio. NUMICO already dumped the low-growth/low-margin products, so now; they can concentrate on long term value creations through developing high-growth/high margin products. Stars of NUMICO: NUMICOs star was infant product but due to lot of exposure in low birth rate countries their business was declining at an alarming rate. NUMICO can utilise the some money which they received from divestment to expand in those countries where birth rate is much better than Western countries like India China. For infant products, long ago NUMICO used to command premium price because of RD patents. Cash Cow of NUMICO: NUMICO should turn their infant product into cash cow by offering cost leadership. After gaining the cost leadership NUMICO can go back to their golden days. To achieve the cost leadership NUMICO doesnt have to invest heavily on supply chain because they have everything which it takes to get the advantage. Dogs of NUMICO: NUMICO already sold the Dogs from their product portfolio now they should not repeat this mistake by taking over another non-business interest investment. Question marks of NUMICO: NUMICO should avoid this block by focusing on cash cows star blocks. Imagine a scenario; if they dont pay much attention now on finding new markets for infant products then they might end-up in this block because western market has declined in term of birth rate and they already sold the maximum distribution points of GMC Rexall in USA. Hence, they should take actions on urgent basis to avoid question mark. Figure: BCG Matrix Source: www.tellingthestory.typepad.com Accessed on: 20/03/2011 BCG matrix can help in understanding the mistakes done in past to fit an all approach strategy for future. BCG matrix is not free from flaws but it certainly explains what to do what not to do. To bring back the growth back into the books of NUMICO they should adopt Ansoff Growth Matrix. As per Lynch (2006), the market options matrix examines the options available to the organisation from a broader strategic perspective than the simple market/product matrix (called in some texts the Ansoff Matrix). Figure: Ansoff matrix Source: www.cipher-sys.com Accessed on: 20/03/2011 As per Ansoff matrix, NUMICO can go for market penetration. It will be like without disturbing the companys existing range of products or services and perhaps it can attract current customers as well. Things can backfire if market penetration is planned for new customers only. For example, mobile companies offer brilliant price plans to retain the existing customer. Market penetration is smooth when the market is growing. Existing organisations with low relative market share in a booming market have little to lose but NUMICO has high relative share and if they dont attract their current as well as new customers then they might lose whatever they are holding till now. Market development using existing products could be a strategic route but for this approach they should not disturb the existing customer focus. In NUMICOs case, they should take infant products to those countries where birth rate is better than Western Europe and USA. NUMICO can slightly repackage the product then can promote to a new market segment. Product development for the existing market can be possible for NUMICO because they have their own RD centres where they can develop new concepts. NUMICO should do optimum utilisation of their all resources to counter competitive entry. NUMICOs RD centres can help them to maintain the companys stance as innovator. Diversification is not needed according to case study because they have just finished the sale of GMC Rexall. Other Strategic Options: Organic growth: NUMICO should start the change from with-in and build itself from scratch and this time they should stick to the core business. Acquisitions Mergers: NUMICO can acquire the rival business or merge with one of its rival from core business market to gain the lost momentum. Strategic Alliances: NUMICO can make some strategic alliances with few government bodies in developing countries. Licensing: NUMICO can sell their patent license or lease to its competitors to build a business from their intellectual properties. Recommendations: NUMICO needs to pursue a growth strategy in a structured way the methods by which the market opportunities associated with strategy options might be achieved. NUMICO should treat their RD outputs as their assets which they can sell in market to claim a tag of future business. Investors like to associate themselves with future markets because they know their money can take them to new avenues with high returns. NUMICO was a leader in RD and infant products but all was lost because of acquisitions in foreign un-related markets products. This time they should build themselves related to their core-strength. For RD, they hired PHD passed-outs but they never presented themselves as a smart organisation which they should focus this time. Current generation would like to associate themselves with smart organisations like Google Apple. NUMICO should aim for future parents who will buy their products services. Given the amount of analysis that can potentially be undertaken, merger with other competitors is highly recommended. Mergers are similar to acquisitions like combining two companies. However, merger can happen in one scenario where both the parties cannot take over each other. This can be a friendly hand but still a special care will be always required. Merger should be sone before identifying the strategic issues. Mergers are never meant to lose the total control of the company but to gain new markets new customers. None of the evidence suggests till date that merger is a value addition but neither has it suggested any failure when both partners are same in size. Merger might not a big value to NUMICO but it can enhance the performance. Although NUMICO can still grow as a stand alone business but to take their research in right path they need a right partner. Partner especially with same business interest but with more distribution points in desired locations can do wonders for NUMICO. NUMICO always had RD centres but they never capitalised on that asset perhaps a partner can take that advantage or turn it into their competitive advantage.

Stock Market Gann

Fast Intraday – There are basically four solstice dates which Mr. Gann said are most important according to the sun based system. He also said, divide the year by octave and you will get the proof of all the natural activities happen across the year. He insisted to divide the year further by octave and you will get the proof of Human behaviors which is fluctuating throughout the year. The important dates are – 1- 21st March 2- 21st June 3- 22nd September 4- 21st December Now if we divide the year by octave we get following dates – 1- 5th May 2- 5th August – 8th November 4- 4th February Mr. Gann also said that â€Å"we use the squares of odd and even numbers to not only get the proof of markets but the cause also. † Here if we look into the Gann square of 9 diagrams we will understand that the natural squares of odd and even numbers happen to be on mid points of the four solstices. Meaning the squares of odd numbers coincidently are falling on the da te 4th February and squares of even numbers are falling on the date 5th August. The magic also lies in the mid points of the squares of odd and even numbers.The mid points do fall on yes you got it†¦ The mid point falls on 5th May and 8th November which are the outcomes of the division of year by octave. So we have a strong argument that the nature and even the Stock markets are influential under the Octave based system. Mr. Gann has said numerous times to use the 45 degree angle. Now the question arises of how he has derived this particular degree angle. The magic is the octave based system. The circle is the answer for everything in life. Take a small or big circle it has 360 degrees. Mr. Gann said that divide the circle by octave and you will get 45 degree angle.Here we are trying to connect the octave based circle with the natural year based on octave. Because from various writings Mr. Gann has said that 45 degree is important and the solstices are important to find any cha nge in undergoing trend. However, whatever he has written is in a veiled language so it is necessary to put it into actual implementation we have to decipher Mr. Gann’s writing. Considering Mr. Gann’s square of 9 structures the spiraling of numbers coincidently (any power behind this creation? ) falls on respective dates and degrees. E. g. the squares of Odd and even numbers exactly fall on the cardinal dates.Their mid point also happens to be on cardinal date. This seems to consist the hidden mathematical truth which needs to get decipher to know the exact movement of Stock Markets or any other tradable securities and commodities. Before going any further studying Mr. Gann we are about to take a ride of Gann Square of 9 as it is one of the most and foremost important structure to consider for day trading or intraday trading. Mr. Gann was consistently using and saying that the squares of Odd and Even numbers are important to decode the daily market movements. The magic also lies in the aligning of squares of Odd and even numbers.If you carefully observe the alignment of Odd and even number squares you will easily find out that they are exactly 180 degrees far from each other. E. g. the Square of 12 i. e. 144 and square of 13 i. e. 169 are exactly opposite or 180 degree far from each other. And their mid i. e. 156. 5 is exactly 90 degree far from 144 and 169. Now the question arises as to how we should put this information for actual trading of Stock Markets. Is there any fixed method we can use for intraday trading using the Gann Square of 9, then the answer is yes. However, there are certain rules to be follow while trading intraday using Gann Square of 9.Each date falling on the cardinal line is consist of a certain time period and hence is known as a time line. There are sixteen different time lines which have been created by dividing the year by octave and double octave. Now what to and how to use this time lines and different squares and num bers is the solution to the full proof plan of guessing or gauging the stock markets. The readers must accept the beauty of Square of 9 and should put to use for intraday purpose only. Because there are different techniques use for long and short term investments.

Inequality & It’s Characteristics

The perspective I have chosen is the social-conflict theory. The social-conflict paradigm is a framework for building theory that envisions society as an arena of inequality generating conflict and social change. This type of analysis focuses on the inequalities within our society and the conflict that they cause between the advantaged and the disadvantaged. The first characteristic is inequality. This refers to the unequal distribution of money, gender, class, and age. People who embrace the social-conflict perspective believe that gender, race, and class should not lead to favored treatment. An example of this would be single mothers who are living below the poverty line. This group of people is likely to remain at least as large as it is now at the present time and/or become larger in the coming decade. Many of these women do not have marketable job skills and few means to attain them due to their lack of finances. The second characteristic is social class conflict. Social class is often defined as the amount of education, income, and status people have. As we know, attaining education is one of the most effective avenues for ensuring employment and an increase in income, which adds up to higher status or social class. Single mothers most often do not have the income in order to pursue higher education. This renders them the title or designation of being one of the lower class groups in our society. If this remains to be status quo, then there is little hope for these single mothers living below the poverty line. The third characteristic is social change. The inequalities and conflict of social class is leading towards a social change. The federal and provincial governments have implemented different types of financial assistance for single mothers living below the poverty line. The government has made it easier for these women to apply for student loans so that they may pursue higher education and job skills. As well, grants have been made available to assist with the financial burden. The government has provided tax relief for lower income families and subsidized day care. In response to the outcries of single mothers and other advocates, the federal government now has a Women's Equality Minister. Canada also has a group called the â€Å"Women's Economic Network† that helps and supports single mothers in getting out of poverty. Analyzing this issue with the social-conflict paradigm has helped myself in understanding that there are inequalities in all aspects of society. When some inequalities are exposed and absolved, there are other ones following close behind. As society evolves, more inequalities are found and dealt with. This type of analysis has also helped me to see that there are resolutions to this problem of poverty with single mothers. It is a grim reality in Canada, but analyzing it from the social-conflict perspective shows that there ways in which we can rectify the problems surrounding this issue.

Term Paper Finance Virtual Stock Trading Summary

Finance Virtual Stock Trading Summary Being an avid stock market enthusiast, I knew that stock trading can be cherishingly profitable and can also be painfully unprofitable. Therefore, being a short-term trader, I was aware about the risk-return pool I am going to swim in. However, I ensured that none of my trades should be influenced by mere market rumors, and any long-short trade should be backed by a valid market information. As for the reasons of selection of the stocks in my portfolio, as I disclosed in the preceding section, each of the stock in my portfolio was backed by either strong fundamentals or a recent news in the market where it was expected for the stock price to surge and provide short-term profits to the investors. For Instance, Apple (Ticker: AAPL) and Starbucks (Ticker: SBUX) were the indisputably the market movers, and while the former surprised the corporate world with blockbuster profit of $18 billion in third quarter (Ciaccia), the latter companys profit figures were well exceeding the market expectations quarter-by-quarter. (Johnston) Therefore, these stocks were rather fundamentally enticing for me to be included in the portfolio. On the other hand, chip manufacturing companies such as Arm Holdings (Ticker: ARMH), InvenSense (Ticker: INVN) and Synaptics Incorporated (Ticker: SYNA), are the suppliers to Samsung, and their latest produce was being used in Samsung 6. Therefore, with te ch-savvy customers eagerly waiting for the new smartphone by the Korean giant and with wide success expected by the market pundits, the stocks of the above three companies were forecasted to witness a surge, and it happened accordingly once Samsung S6 was launched in the market and was declared a success. We also took a calculated risk by buying Mc Donald Stock (Ticker: MCD). The company was going through a bearish phase since a long time as the fast food chain came off with sluggish fourth-quarter results, which was fifth consecutive quarter of U.S. sales declines and most of all company had witnessed the worst every same store sales growth. Therefore, a bold move was expected from the board to rejuvenate the investors confidence in the company, and this came up with a management shuffle with CEO, David Thompson asked to step down and Steve Easterbook, who had led the fast-food giants UK and European unit for more than two decades was named the new CEO of the company. (Walsh)The market responded positively to this managerial action and stock surged by 5%, and yet again we were successful on reaping profits from our trading strategy where we benefited from positive market hypes. Similarly, stocks of companies such as Hershey(Ticker: HSY) and 1-800-Flowers.com(Ticker: FLWS) that are retail food gourmet distributors and whose sales are significantly dependent on festive sales, were bought around Valentine Day as were expecting to capitalize our gain with stock price expected to be fueled because of the festive sales. Once again, my strategy turned profitable, and I was able to earn the stocks at higher price soon after the valentine day. Considering all the discussion relating to my trading and stock selection strategy above, I do not believe that it was pure luck as many of my stocks reaped profitable figures. Having experienced the carnage brought by the financial crisis of 2007-08, where many of my friends and family members lost their investments by about 60% and were trapped into the burst of housing bubble, I had decided not to believe in any market rumor and fall the victim of herd behavior. Each of my stock selection was either a tried and tested stock with consistent performance over the years, or was selected based on recent market news that could provide us with short-term profits. Although I carried all the trades on short-term basis, but I had still ensured that my portfolio is a well-diversified one and non-correlated stocks from different industries are included in it. So, technically, I was trying to follow the pursuits of investors God, Mr. Warren Buffet and his notion of Do not put all the eggs in one basket. Therefore, it was the mix of experience and stock selection formula that showed me profitable phase of the stock trading. At the end, the only limitation which I experienced while doing the trades was the time period for which I held the stock. As you may witness that I was aggressively buying and selling the stocks in the matter of few days only, the strategy did not turned well for stock such as Apple (Ticker: AAPL) which I sold at a loss of -$0.51/ share+ commission expense loss, and had I held the stock till today (AAPL: $130.10), I would have made a hefty profit of $10.28/share. Therefore, if given a chance to redo, I would re-consider my trading strategy for the stocks that need trust in a long-term horizon. References Ciaccia, Chris. Apple Surges Following $74B Revenue Quarter, 74M iPhones Shipped. 27 January 2015. 5 March 2015. http://www.thestreet.com/story/13025026/1/apple-surges-following-74b-revenue-quarter-74m-iphones-shipped.html. Johnston, Chirs. Starbucks profits soar 82% in final three months of 2014. 22 January 2015. http://www.theguardian.com/business/2015/jan/22/starbucks-fiscal-first-quarter-profits-up-82-percent. 29 February 2015. Little, Katie. McDonalds CEO Don Thompson steps aside, stock jumps. 28 January 2015. http://www.cnbc.com/id/102376552. 29 February 2015. Walsh, Tamara. What McDonalds Management Shuffle Means for Investors. 1 February 2015. http://www.fool.com/investing/general/2015/02/01/what-mcdonalds-management-shuffle-means-for-invest.aspx. 29 April 2015.