BUSINESS PROPOSAL
BUSINESS PROPOSAL
Business Proposal Marsha Bosier Economics 561 The University of Phoenix Amanda Freeman April 26, 2015
Kellogg has been in business since 1906, when W.K. Kellogg opened the Battle Creek Corn Flake Company and carefully hired 44 employees. Together they created the initial batch of Kelloggs Corn Flakes and brought to life W.K.’s vision for great tasting breakfast. Kellogg has become a multinational food manufacturing company. In March of 2001, made their largest acquisition of Kebbler Company and in 2012 they became the second largest snack food company when they acquired Pringles potato chips from Proctor and Gamble.(Kelloggs). Kelloggs has remained a leader in their industry through the recession of 2009 and cereal recalls in 2010 and 2012. The stock in the company has risen in the last few months to over $80 a share (yahoo. Finance), which has allowed the company to continue to grow. To understand the company, one needs to know the market structure in which they do business.
Market Structure The market structure in which Kellogg does it business is an oligopoly. An oligopoly is formed when a few companies dominate a market. In this market the four main cereal companies are Kellogg, Post, General Mills and Quaker Oats. Whether by noncompliance practices, government mandates or technological savvy these companies take advantage of their position to increase their profits. In order to increase their profits they need to know how the price of their cereal is related to the elasticity of the product.
Pricing Related to Elasticity of Product
BUSINESS PROPOSAL
Business Proposal Marsha Bosier Economics 561 The University of Phoenix Amanda Freeman April 26, 2015
Kellogg has been in business since 1906, when W.K. Kellogg opened the Battle Creek Corn Flake Company and carefully hired 44 employees. Together they created the initial batch of Kelloggs Corn Flakes and brought to life W.K.’s vision for great tasting breakfast. Kellogg has become a multinational food manufacturing company. In March of 2001, made their largest acquisition of Kebbler Company and in 2012 they became the second largest snack food company when they acquired Pringles potato chips from Proctor and Gamble.(Kelloggs). Kelloggs has remained a leader in their industry through the recession of 2009 and cereal recalls in 2010 and 2012. The stock in the company has risen in the last few months to over $80 a share (yahoo. Finance), which has allowed the company to continue to grow. To understand the company, one needs to know the market structure in which they do business.
Market Structure The market structure in which Kellogg does it business is an oligopoly. An oligopoly is formed when a few companies dominate a market. In this market the four main cereal companies are Kellogg, Post, General Mills and Quaker Oats. Whether by noncompliance practices, government mandates or technological savvy these companies take advantage of their position to increase their profits. In order to increase their profits they need to know how the price of their cereal is related to the elasticity of the product.
Pricing Related to Elasticity of Product
BUSINESS PROPOSAL
References: Colander, David (2010). Economics. (8th). New York. McGraw-Hill. P.283-284 Kellogg. Kellogg Company Retrieved April 2015 from www.kellogg.com Yahoo Finance. Kellogg Financial. Retrieved April 2015 from www.yahoo.finance.com Your Dictionary Oligopoly. Retrieved from www. Your dictionary.com/oligopoly- Examples.html Zheng, Kathy Examples of Oligopoly. Retrieved April 2015 from www. your Business.azcentral.com/examples-oligopoly-market-6720.html