PORTER ANALYSIS - Empresa: CHIQUITA

CUSTOMERS

Chiquita distributes her products across the following channels:7
Grocery stores (in more than 60 countries)
Food retailers
Foodservice distributors and operators
Quick-service restaurants
Fresh produce foodservice offerings primarily to third-party distributors for resale.

Chiquita’s customers are primarily retailers and wholesalers. To a significant extent in North America, and increasingly in Europe, the company’s retail customers are large chain stores.

Chiquitita’s customers are not concentrated at all, being widely distributed along Europe and North America. We consider this distribution structure a core asset as the presence in so different markets decreases the risk level even if globalization has integrated economies and its performance. Even if banana distribution is highly concentrated in the USA, this market can be considered a whole heterogeneous market itself.. Indeed, this concentration risk is compensated with the wide distribution of salads, snacks and coffee in Europe and Middle East.

Another asset in Chiquitita’s organization is the fact that now client can buy directly our production, as it is nearly totally integrated in our manufacturing channel, as we cultivate and produce our products. So there is no potential risk from the supplier side as our vertical integration policy prevents us from that risk.

Likewise, our brand image is well positioned among our customers, being considered as a quality product that brings health, and happiness, that enables us to have an excellent position in the market. Needless to say that this image is supported by continuous commercial campaigns and information services to promote the positive effects of consuming fresh and healthy food.

PROVIDERS

As we have mentioned before, our company has a vertical integration strategy that has taken us to control the 90% of our banana production, including quality control and establishment cost generation, enabling us to control all the processes along the value chain until the distribution and avoiding a possible forward integration of the providers. On the other hand is in logistic area where Chiquitita has may have hardest difficulties in things related to warehousing, handling, transport and distribution. Anyway, even if cost control and distribution problems may arise, Chiquitita can solve them due to the long experience in cargo managing and the big quantity of volume we manage.

In addition, our contracting volume allows us getting scale economies and reducing cost by having a powerful position when dealing with our providers. This win–win negotiation comes from the prestige that is for our providers to work with a company that has been operating for more than one hundred years in this business.

Indeed our product is strongly differentiated from the competitors in quality and health standards, company culture and origin and production methods. This sector enables us to increase our dealing position with our providers.

COMPETITORS

Regarding her first product, the banana, Chiquitita competes on a few segmented where competitors can be divided into two different groups. The first group is composed by big multinationals such as Dole, Del Monte and Fyffe’s. These are Chiquitita's great competitors as they are the ones that can create more problems along her value chain. Firstly, competitor can negotiate with the same banana suppliers (even if it’s only 10% of total production of bananas), impeding the acquisition of raw material.

Next step refers to the logistic suppliers, a really important question in the value chain as it involves the use of highly specialized ships with refrigerating containers to maintain products quality during transport. Even if competitors can deal with Chiquitita’s suppliers, she relies on wide experience in the emergency management that can solve the situation.

Dole’s production is geographically more diversified that Chiquitita’s, which allows them to confront better the climatic casualties. On the other hand we have a group composed that grow banana and do not sell their production to any of those multinational companies previously mentioned.

Regarding salads and fresh snacks, it’s not possible to make a segmentation among it’s competitors.

SUBSTITUTIVE PRODUCTS

For any kind of product we only distinguish an important Group of products that can be considered as substitutes. We consider as substitute products all the fresh fruit juices, low fat food, biologic manufactured products. We would like to outline that we do not consider other fruits as substitute for bananas as their characteristics are quite different. We consider that those who want to eat banana will not eat an apple or watermelon instead.

Grupo