National Training Infrastructure and Competitive Advantage in Biscuit Manufacturing

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Issues that Biscuit companies is facing with resourcing and development

Volatility in the prices of Raw Materials-

Key ingredients which are used in the process of manufacturing of biscuits such as flour, sugar, wheat, butter, cocoa etc. are getting costlier in the wholesale market. For instance prices of milk and sugar has gone up to 4 per cent to 5 per cent. This in result has increased the price of biscuit for the end buyers. Most of the people in UK are price sensitive and that is why manufacturers in UK are facing difficulty to increase the prices and if they don't stakeholders of the company will realize the reduction in profit. It is not in the hands of biscuit manufacturer to control the prices of the raw materials which are used in making biscuits but they can surely work on formulating the strategy (Noya López and et.al., 2018) so that they can be prepared for the fluctuations in the pricing of the market. Many companies have used the method of Tech Sci Research so that they can improve the value chain and provide them with the intelligence of market. It also help in facilitating the channel of distribution and developing the product and improving the strategies of sales. Tech Sci helps in conducting the forecast of market for manufacturers so that they can predict the outcome of the selected decision. Companies need to set up their strategies according to the pricing fluctuations in the market. For instance when the price of the materials is low company should buy more and more products and when the situation is opposite than they must run their operations by depending on the inventory they have maintained. Companies can overcome this factor only by forecasting about supply and demand of the product in the market. This is the area of expertise for Tech Sci. There have been some real incidents where companies have predict the outcome by forecasting the demand and supply through this method. With the help of this research and the information provided through it companies can buy the materials which are needed to manufacture biscuits at most reasonable prices.

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Highly Fragmented Market-

Companies who serve in this industry faces a high level of competition from many other companies. Apart from this companies who operates on a large scale has a diversified product portfolio which in result increased the fragmentation of markets for the biscuits. This factor is taking the time of companies and not letting them focus on the sales of a single brand. This lead to increase in the promotional activities conducted by the company which creates a huge amount of expenditure for the companies. This all factors combined lead to decrease in profits for companies. Up to 40 per cent of the market is unorganized. It is another concern for the companies which affects the productivity of the companies. On the other hand who have made their distribution network organized helps them to reach at markets where people are price sensitive and areas in which spending power of people is low. (Stojceska, 2017)

Companies need to partner or tie up with someone so that they can understand the local areas and spread awareness of their products in those areas. Sector which is unorganized must be put under scope for the companies as it is a large market which is untapped by several companies. If they companies make a share in that market then they will have the leverage over their competitors. Before taking this step companies need to understand the perception of the customers so that they can penetrate deeper in this area of market. Tech Sci research has helped several companies by carrying out the perception of buyers and highlighting the points which influence the customers and convince them into making a purchase. According to studies and research if the promotional tools such as advertising and marketing is done in the right way then consumers of district level can shift to branded products from local products. By the help of this research companies have been able to position their product appropriately.

Negative Impact of Brexit-

It has been a hurdle for business manufacturers due to the exit of Economic Union from UK. The reason behind this is that new policies has been formed which has affected the economy in a bad way and the political environment is not stable. The implications are expected to be for a longer period of time. After this effect either companies will have to go through less profits or else consumers will have to pay more for the products as company will increase the prices of the products. (Noya and et.al., 2018.)

In order to face this implementation of new policy companies have to adopt a solution with a viable long term approach. All the companies be it bigger or smaller will face many problems due to this issue. If they come up with a new long term plan which can absorb these factors then they will not be affected. For that company needs to analyze and predict the demand and supply for a long term. Company has conducted research in both international and domestic markets which will help them to formulate and plan a strategy so that they can maintain their operations easily. It is necessary for the companies who manufactures biscuit to understand the common realities of the market so that they can predict the outcomes which will help them to stay ahead from their competitors and dodge any hurdles if they arise so that they can continue to work in an efficient manner. (Leiva-Valenzuela and et.al., 2018.)

Why is the productivity level of biscuit manufacturing companies of UK lower than companies in continental Europe

Many Regions don't have enough productive companies-

Every business in UK sells goods and services in their local area. Their outcome turns out to be unproductive for the companies. The most productive companies are those who export their goods and services outside from the local markets. (Stojceska, 2017)

Low Skills Workers are too Prevalent-

Workers in UK does not have skills to cope up with the expectancy of the needs of the market as compared to workers in continental Europe. According to a study England had the largest no. of people who are unskilled according to the advanced economies. Workers there were the same as workers who were old which states that the country will face more weaker productivity in the near future. (Evans and Taylor, 2019. )

Some of the factors are because of the companies who are unproductive. Compared with the Continental Europe their output is very poor. On the other hand Continental Europe has companies which are highly innovative. There problem of productivity has been termed as a problem of long tail. Earlier they used to depend on some companies which were highly productive. That is why their workers have been unskilled. Other than this companies who are productive has not been increase their share. Due to the financial problem and recession productive firms are not able to improve on the same rate like they used to. Even the productivity of the country has fall as compared to their earlier productivity. The consumption of biscuit is also low in UK as not many people prefer to buy biscuits instead they chose cookies over them. The country still have a scope to increase their share in the market if they make more variety of biscuits. Retailers in UK changed their strategies of promotion from buy 1 get 1 to single price deals which has impacted the sales as compared to Continental Europe. (Tarancón and et.al., 2015)

Biscuits are considered as a tea or evening snack. Up to 6 billion biscuits were consumed last year in UK and that too in a duration of 3 weeks. But the current situation is sales of many companies has been affected because of the floods which came across Cumbria which forced some companies to close their facility. That also stopped the production of many companies for four months which has affected the sales as there is a shortage in the market for biscuits. The current situation is also being termed as The Great Biscuit Shortage. Above this it is mentioned in this report that biscuits are a tea snack or evening snack but recently since past 5 years even the sales of the tea is falling. On the basis of quantity it has seen a fall from 97 million to 76 million kilos which has also decreased their price. Still there is no effect on positive side for both the products. The reason behind this is more and more people are shifting to healthy snacks and avoiding biscuits and cookies as it has a huge amount of sugar in it which is not good for health. (Chronopoulos, 2017.)

What HR practices can UK biscuit manufacturing companies use to increase competitiveness in the marketplace

Selective Hiring-

Companies need to change their way of working they need to stop hiring people who does not have adequate skills and are not relevant for the job. If they hire people who comes under the level of high performer. They can increase the level of productivity up to 100 percent. That is why company needs to hire high performers it is a key resource in increasing the level of productivity and gaining competitive advantage. HR of the companies can take the help of various tools to check the eligibility of prospective candidates. They even of to keep on an eye on the existing employees that if or not they are performing up to the market then only biscuit companies will be able to rise their revenues. (Bendary and et.al., 2019. )

Training-

Companies need to set up a department specifically for training as people in UK are highly unskilled and they require a lot of training to be eligible for working in the biscuit industry. After hiring them companies need to make sure that they are experienced and front runners in this field. Now because of the technological factors rate of development is increasing. That is the point where line for development and learning opens up. If they follow all these methods then they will achieve growth faster, they will find a way to stay innovative. Internet has increased the scope of courses which are on demand because now people can stay connected all the time and learn things anytime, anywhere. Apart from this young generations has to learn a lot rather than people who are old because of the raid development and change in every aspect companies can rely only on young generation to learn and cope up with the factors which are required and essential for a business to run. (Colwill, Despoudi and Bhamra, 2016,)

CONCLUSION

From the above studies it has been concluded that companies in UK which serve in biscuit industry needs to adapt the measures which are highlighted in this report. Otherwise they will continue to face the downfall and decrease in profits. The reason behind the downfall is their unskilled labors for which companies need to start a training program so that they can cope up with the factors and have difference set of skills against the old labor.

Read more - Rules and Regulation for Business Law

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