Essay Sample on Blue Bell Creameries

Since the company was founded in 1907, it has grown financially and geographically. Geographically, the company has expanded from Texas to other states, including Oklahoma, New Orleans, and Jackson among others. In terms of financials, the company has grown likewise since its initial public offering. According to Hem (2006), Blue Bell Creameries had invested $2,200 in 3rd August 1907, but the financial muscle grew exponentially over the years as the company sold $305 million of ice cream product. The financial information was provided by Packaged Facts, which is a food industry analyst firm. According to Parrish (2015), the company had amassed an estimated revenue of $680 million in 2014 financial year. Previously, the company had made $620.7 million in the 2013 financial year (Parrish, 2015). For this reason, there was a significant financial growth for the company between 2013 and 2014.

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However, the financial growth was hampered by the massive recalls, which made the companys revenues plunge in the 2015 financial year. As Halkias (2015) states, the company experienced a worsening financial plight in the 2015 financial year owing to the system-wide recalls, and it was estimated that the company would make losses that would sum up to $130 million. This assertion was proved as the evidenced by Statista. According to Statista (2016), the company made approximately $570 million worth of sales in the 2015 financial year. The financial data is shown below for the 2015 financial year, and in comparison to the competitors in the US ice cream industry.

Sales Revenue for Blue Bell Creameries and Competitors in the US ice cream industry. Source: Statista (2016).

However, because the company experienced an overhaul following the recalls, the revenues are set to increase substantially. For instance, as Sam Hamadeh asserts, the PrivCos CEO, which is a company that tracks Blue Bell Creameries financials, the company is set to have its sales revenues increase to an estimate of $180 million, and thus, provide a basis for financial growth over the consequent years. Besides the system-wide recalls, other issues that are facing the company include employee lay off. For instance, according to Halkias (2015), Blue Bell laid off an estimate of 1,450 workers in 2015. In addition, the remaining employees saw their salaries reduced because of the financial struggle the company has sustained following the massive recalls. As the author asserts, 1,000 employees remained toi manage operations, which may be inadequate, and may also hinder performance and productivity of the employees.

As shown in the Statista graph, Blue Bell Creameries faces competition from a variety of firms. The private label products, I accordance to Statista (2016), presents the greatest market share in the American ice cream market include, and made approximately $1069.4 million in 2015. Blue Bell Creameries brand is the second with an approximate $570 million. For this reason, the main competitors for the firm fall within the private label brands, and thus, Blue Bell can be considered as the number one brand in the ice cream market. Other competitors include Haagen-Dasz, with a sales revenue of $382.2 million, then Breyers, Ben & Jerrys, Dreyers, Turkey Hill, Talenti, and Wells Blue Bunny. As such, from Statista comparisons, it is clear that the competitive threats are private labels, as well as these other competitors. However, to mitigate them, Blue Bell has to observe quality in their products.

References

Halkias, M. (2015). Blue Bell lays off 1,450 employees and furloughs 1,400. Biz Beat Blog. Retrieved from http://bizbeatblog.dallasnews.com/2015/05/blue-bell-lays-off-1450-employees-and-furloughs-1400.html/

Hem, B. (2006). After 100 years, Texas' Blue Bell enjoys sweet success. Houston Chronicle. Retrieved from http://www.chron.com/business/article/After-100-years-Texas-Blue-Bell-enjoys-sweet-1863753.php

Statista. (2016). Leading ice cream brands sales of the U.S., 2015. Statista. Retrieved from http://www.statista.com/statistics/190426/top-ice-cream-brands-in-the-united-states/