Leigh steel Case study Example | Topics and Well Written Essays - 500 words

Leigh steel - Case Study Example Standard costing assumes that profitability is linear and increase in production volumes should increase profitability. This costing method only gets the difference of the selling price and the total expenses. There is an assumption that the overheads are attributable to products forms the main bases of this model. ABC focuses on the cost of the activities that are involved in production of a product while in ToC costs are associated to the limiting factors that affect the optimization of profits. ToC takes into consideration that all limiting factors can be redefined further. ToC is concerned with the time-value for money. It restricts costs to limitations of value of each constraint. These constraints identification is the most crucial part of this theory. The fact is emphasized by the fact the fifth stage of is a continuation of refinement of the constraints. It is important that in further refinement the existing constraints do not become new constraints. If the previous constraints is considered then the cost may attract double cost. Edward states â€Å"Throughput was defined as quantity of money† as profit are maximized by â€Å"maximizing throughput per unit†. Assignment of cost in ABC is made by assigning cost to the various activities, this model assumes that only the activities of production contributes to the cost of the product. This assumptions does not take into consideration the cost of decision making in the company. Decision making on when to produce a product and the product mix based on the volume or expected demand is a key part of ToC. Lehigh’s decision-making is put into consideration when using ToC in evaluating the cost of inventory valuation. Standard Costing takes into consideration only the pounds weight of the product to calculate its cost. There is no consideration on the cost of decision-making. Is there a cost incurred due to demand. Standard Costing at Lehigh,

The Chicago Outfit Essay Example | Topics and Well Written Essays - 250 words

The Chicago Outfit - Essay Example It has been alleged that the Chicago outfit, in its operations, have directly or indirectly been aided and abetted some legal structures of government. For instance, they were said to have been behind many electoral malpractices, particularly the 1960 elections into the office of president. The Chicago Outfit is also alleged of short-changing Hollywood by having power over the unions that direct the affairs of Hollywood. Perhaps the action which is most indicative of the political corruption that aided the rise of the syndicate is that which touches on the attempts allegedly made by the government of the United States to use them to scuttle the Cuban government led by Fidel Castro (Mallory, 2007). The government and her institutions seem to now know that they need to tighten things up a little bit. Thus, some years ago, precisely between 1999 and 2009, a number of crackdowns on members and associates of the Chicago Outfits took place. Many of them were prosecuted. Most of them were found guilty of atrocities like gambling, tax evasion, extortion, and above all, murder (Mallory, 2007). They were handed prison terms and some were even given life imprisonment. This crackdown has indicated the government’s readiness to find an end to the gang. Nonetheless, it doesn’t mean the Chicago Outfit still doesn’t have its way as organized crime by the Chicago Outfit is still a societal

The Importance Of Environmental Risk Assessments Environmental Sciences Essay

The Importance Of Environmental Risk Assessments Environmental Sciences Essay Environmental risk assessment is an integral part of a project. It is important that a project attributes due weight and consideration to the assessments conclusions, although it is just as imperative that an assessment identifies the assessment endpoints in order to determine the application and usefulness of the assessment. Depending on the specific project, an environmental risk assessment can be utilised to assist a project to assess strategic and or tactical uncertainties, as well as assisting in making the best informed decision given the circumstances. (Beer Ziolkowski, 1995, p. 6) Environmental risk assessment is the process (Joint Technical Committee OB/7 Risk Management, 1999) that analyses, considers and then places into a criterion framework the risks to human health, welfare and ecosystems that are the result of adverse developmental impacts on the natural environment. (Beer Ziolkowski, 1995) The placement of the foreseeable risks into a specified criteria, level and/or predetermined standard enables a project to consider, in comparison to the same, what environmental hazards have the greatest potential of occurring, as a result of a specific project, to the selected endpoints and what action (if any) is required. (Joint Technical Committee OB/7 Risk Management, 1999), (Beer Ziolkowski, 1995). The usefulness of environmental risk assessment can depend on what criteria, pre-determined standard and/or level is being utilised as an acceptable comparison. What may be important to one specific environment may not be important to another, therefore, it is important, prior to the commencement of the environmental assessment, that the environmental values to be protected (Stoklosa), the endpoints are agreed. The importance of environmental risk assessment as a necessary component of a project is evidenced in a recent predictive case study commissioned by Alcoa, the worlds largest producer of aluminium (Alcoa Inc.), with respect to an aspect of the construction of its proposed aluminium smelter in East Iceland. (Booth, et al., 2009) (referred to as The Aluminium Smelter Study). The Aluminium Smelter Study is an example of predictive risk assessment. The study was conducted to determine whether there would be a consequential difference in the level of risk to human and ecological receptors from constituents in air emissions from the aluminium smelter (prior to construction), either with or without wet scrubbers. (Booth, et al., 2009, p. 423) Gaseous emissions from the aluminium smelting process are minimized by existing controls, although not all emissions are captured by these basic controls. Prior to the commencement of the study, there was no certainty regarding whether the addition of wet scrubbers to the basic controls would provide any additional benefit as these also introduce an environmental cost. It is necessary for Icelands Permitting Authority, if they are to approve the Smelter without the need for the wet scrubbers, that an environmental risk assessment is conducted with the harm for both scenarios, with and without the wet scrubbers, explored in advance, in order that the authorities can make an informed decision. Although wet scrubbers can in some circumstances control gaseous emissions, the contaminants removed by the scrubbing are transferred into the smelters surrounding water ways, potentially causing harm to the surrounding ecology and humans alike. For the purpose of the assessment, the selection of the emissions/contaminants present in the smelter region, which may be emitted with or without wet scrubbers, were determined on the basis of what the principal constituents of gaseous emissions from primary aluminium production are. (Booth, et al., 2009, p. 429) These include, fluorides, particulates, sulphur dioxide, carbon dioxide, carbon monoxide, perfluorocarbons and polycyclic aromatic hydrocarbons (PAHs). The design of the smelter and the operational controls already in place were considered prior to identifying the contaminants that may pose a potential risk to the pre-determined endpoints. Whether or not the wet scrubber process will cause substantial harm to the environment requires a risk assessment of weighing the environmental risks of exposure to humans and the environment to the emissions and waste generated with and without the wet scrubbers. . The environmental endpoints for the purpose of this environmental risk assessment were selected on the basis of a number of criteria, including, amongst others, the ecosystems and species that are present in the Hraun industrial tract and surrounding areas in Ewyarfjorour, Fjardabyggd, on the east coast of Iceland (Booth, et al., 2009, p. 425) in close proximity to the aluminium smelter site. In addition, further endpoints were selected by considering terrestrial and marine site studies (which) were conducted (Booth, et al., 2009, p. 425) in the early planning phase and using the information obtained to determine what plants and animals in the surrounding area could be at risk from the wet scrubber emissions. The human environment endpoints were also assessed, utilising studies completed in the planning stage of the smelter site and its surrounding Fjord area. The Aluminium Smelters location in East Iceland presents a unique environment, where there is little development and, due to both the weather and terrain, a relatively stable population level, see Figure 1 of Appendix A . The studies assessed the population of the surrounding area, noting that the terrain restricts much human population, the potential exposure pathways (i.e the drinking water for the residents in the villages is the river Delta and those outside the villages use bore water, neither of which there is any indication the smelter will affect.) and whether the populations source of food will be affected and, in turn, could indirectly expose the human population to harm. The Aluminium Smelter Study measured the harm to both human health and the ecology by developing a number of different conceptual models to assist in identify(ing) the controlling variables that affect exposure and risk, and to focus the risk assessment process on the most important pathways of potential exposure. (Booth, et al., 2009, p. 430) Figure 2, at page 431, is an illustration of a conceptual site model, which assists to identify the exposure pathways from the source, its transport, the media, (i.e air, soil, water) and then the effect on humans and the ecology. In particular, attention is directed when electing the endpoints to those plants, animals and humans that are potentially sensitive, or will be at greater risk of exposure, to the emission contaminants as identified as potentially being present. Further consideration must also be directed to ecologically important species and those species having special regulatory status (if appropriate) or social importance. (Booth, et al., 2009, p. 430) If, after having conducted all of the above and considered all the contributing factors of the models, a pathway was identified as having a potential to be complete, that factor was then assessed as posing a potential risk to the end point Alcoa engaged Earth Tech to conduct the air dispersion modelling, which was required to assess both the human and ecological risk assessments. Air dispersion modelling was chosen as the best method, considering the difficult Fjord landscape and complex wind conditions, to determine the effects on the receptors from the wet scrubber and no wet scrubber smelting scenarios. A copy of Earth Techs report is annexed at Appendix B. A copy of Earth Techs report is annexed at Appendix B.A number of air modelling scenarios were simulated in order to assess exposure to provide the relevant basis for comparison to standards that are protective of human health and the environment (Booth, et al., 2009, p. 434). These scenarios are illustrated in Table 2 and the time frames were chosen in order that the results could be compared to the corresponding regulatory limits that are protective of human health. The different environmental values to be protected require different measures of assessment. For example, in order to measure the harm of the risk to plant species in the Fjord, the model requires modelling for annual mean sulphur dioxide (SO2) (one of the identified emissions) exposure as toxicology-based screening values for plants are expressed as annual averages. The results of the dispersion models were exhibited on a geographic grid. For a more detailed explanation of the grid and a copy of the same, see page 437 (Booth, et al., 2009). (Katie, what does this add?) In order to assess the risk of the estimated air concentrations and deposition rates, with or without the effect of seawater scrubbers, the two scenarios were compared on a point-specific basis or were examined statistically or probabilistically to describe the nature of exposure to each constituent by sensitive receptors. The study not only conducted air modelling exposure modelling, the risk assessment process also utilised previously conducted marine dispersion modelling, which assessed the harm to the Fjord marine ecology, including modelling sediment and the concentration in water of elements such as fluoride, another of the identified end point contaminants. The marine dispersion models were then assessed using data from further previous studies, as well as data collected from other Alcoa facilities, such as those in Canada and Norway as a means of verifying the reasonableness of the predictions at Fjord. (Booth, et al., 2009) In addition to the air dispersion modelling and marine dispersion modelling, the risk assessment also assessed the potential adverse effects from sediment bound substance and dissolved substances (Booth, et al., 2009, p. 438) from the discharge of water into the Fjord in the situation of the seawater scrubber. The constituents, in particular PAHs (emission of which is usually associated with effluent sediment from the wet scrubber), that were hypothesised to be released into the Fjord, were selected to be assessed. The harm of these constituents (see page 438) was measured by comparing modelled concentrations in sediment and water to available toxicity thresholds and screening benchmarks. (Booth, et al., 2009) Similar modelling was utilised to assess the effect of the scrubber discharge to wildlife, including food web modelling for species that forage on items that could potentially accumulate PAHs. (Booth, et al., 2009). Similarly, the harm to plants was measured by comparing the mo delled air emission concentrations of SO2 and fluoride to conservative toxicity thresholds for sensitive plant communities. Further, the risk to vertebrates was determined on the basis of predicted concentrations of fluoride and PAHs (sic) in the diet of herbivorous mammals and birds, based on the EarthTech air modelling results and plant uptake models, and comparing those dietary concentrations to toxicity thresholds developed from the scientific literature. (Booth, et al., 2009, p. 438) There were some limitations in the study on the effect of emissions from the two alternate scrubber scenarios, which are discussed in further detail at page 439. The quantitative results to the identified receptors and the concentration estimates of emission constituents in the air from inhalation exposure were measured to be considered in comparison with all relevant standards, and PAHs (sic) were compared with health-protective screening values for air and soil. In addition to the human risk of inhalation of the emissions, the study also assessed the harm from dermal (skin) contact to humans, one of the identified endpoint pathways. The soil concentrations, in accordance with the model (see page 439), were then compared to well-accepted health-protective soil preliminary remediation goals for BaP and HF developed by USEPA. The potential harm on human health from the discharge of constituents in the air and soil were measured by comparison to elected, accepted benchmarks. Each of the different models required different types of methods to measure the predicted harm. In order that the risk assessment provides the most accurate conclusions that can be relied on for decision making, the different end points required different benchmarks for assessment. For a more detailed assessment of the effect of the identified emission contaminants on the endpoints, see page 439. The results of the modelling predictions on the level of risk to human and ecological receptors indicated that both scenarios produce results that are lower that the identified risk thresholds and, by and large, the risk to all end points was lower for a smelter without wet scrubbers. Alcoa submitted the results of the environmental risk assessment to the Government of Icelands Permitting Authority and, in turn, the Authority approved an operating permit for the facility without the need to install seawater scrubbers. (Booth, et al., 2009, p. 440) It must be noted that some caution must be attributed to the risk assessments findings as it was financed by Alcoa, however a disclaimer appears on page 1 of this study, the opinions expressed are the independent scientific views of the authors (Booth, et al., 2009, p. 423) and it would appear that the Iceland Permitting Authority agrees. The benefit for Alcoa was threefold. Firstly, by successfully obtaining the Iceland Governments permit, they were not required to expend the additional cost of constructing the seawater scrubber. Further, the results of the environmental risk assessment were able to be distributed to the local community, assisting Alcoa in continuing to uphold its duties to the people of the area faithfully. (Alcoa Inc.) Finally, Alcoa have utilised the environmental risk assessment to demonstrate the long-term sustainability of operations, as well as environmental protectiveness. (Booth, et al., 2009, p. 440). The information obtained from the environmental risk assessment process was a necessary component of Alcoas aluminium smelter Iceland project.

The Faults in the Recent Project of Sainsbury :: Sainsbury Business Management Essays

The Faults in the Recent Project of Sainsbury In 2000, Sainsbury’s began its â€Å"business transformation programme†. The grand plan includes what is arguably the largest and most ambitious retail supply chain project in Europe. The main driver was the need to cut costs. However, internal research found that the company’s cost-per-case was significantly higher than its nearest rivals. Sainsbury‘s had been managing distribution in the same way for more than 40 years, which is mainframe-based warehouse management system, Its typical distribution center was almost as old. Compared to the age of the average Tesco depot—seven years—Sainsbury's depots were nearing the end of their useful life. The old system of depots was designed for the purposes, such as packing for meat and own-brand goods. However, it means that one store could be receiving goods from five or six different depots in any one day, which was highly inefficient. The old delivery system was also ill-suited to changes in customer tastes, habits and store locations. Supermarkets have to offer a wider range of products, in smaller volumes and at lower prices, than in the past, to people who shop when they need to rather than stocking up once a week. â€Å"Today, Sainsbury’s carries 2.5 million cases per week from around 2,000 suppliers. It also has to deliver them to 500 outlets every day, ranging from traditional large stores to smaller shops on previously untapped territories, such as railway terminals and Shell petrol stations. Given this diversity, daily â€Å"waves† of restocking are required from 5am onwards.† (http://www.supplymanagement.com/archiveitem.asp?id=8784, 4/4/2005) In order to service this need, Sainsbury revamped its supply chain and created a complete end to end supply management system. â€Å"The initial timeline for the project was seven years, as the struggling chain set about pruning a network of 25 distribution centres to just nine facilities in eight regions around the UK. Another part of the plan was to build four giant warehouses, two of them fully automated, for  £400 million each." (http://www.supplymanagement.com/archiveitem.asp?id=8784, 4/4/2005) Sainsbury did it in three years, to catch up with, in some cases, and some cases overtake its rivals. Sainsbury's uses a number of IT systems to manage its supply chain, mostly within the Accenture outsourcing deal. Distribution warehouse management systems are provided by Manhattan Associates. Eqos has built an alerts system to improve stock availability in store, based on Microsoft .net technology. And Retek has supplied software to forecast product demand in Sainsbury's stores. By implementing automation, Sainsbury was hoping also to avoid human errors so that errors were right at the first time Although, Sainsbury has been working hard to improve its supply chain, however, the operation of its four new automated depots

Case Study Analysis of “Wal-Mart: the Main Street Merchant of Doom” Essay

The rapid and enormous expansion of Wal-Mart and its market share have changed the landscape of Main Street in towns and cities across America. By 1981, Wal-Mart became Americas largest retailer. It has approx. 6,700 stores worldwide, $345 billion in net sales (2007), and roughly 100 million weekly customers. Wal-Marts massive footprint has had three primary areas of concern: 1) Putting local small business merchants out of business 2) The creation of urban sprawl 3) Traffic congestion †¢ Largest purchase made from overseas which forced local manufacturers out of business. †¢ Oppositions from labor unions and activists organizations regards to low wage, low benefits and taking advantage of illegal immigrants. †¢ Gender discrimination against women. †¢ Most sued company in America in respect of lawsuits. In the mid 1980†²s, Wal-Mart was becoming responsible for the loss of American jobs due to the sheer volume of foreign purchases from its overseas vendors. The company was contacted by then Gov. Bill Clinton and he requested that they devise a plan to support American manufacturing. Wal-Mart responded with a â€Å"Buy American† program to support American manufacturers, but the plan was eventually abandoned. Wal-Mart is currently the largest purchaser of Chinese products. This shift in policy caused the loss of American manufacturing jobs once again. The aggressive marketing of Wal-Mart, its purchasing power and intent to provide very inexpensive goods to the consumer has shut down many local merchants. Even with continued resistance in many communities, Wal-Mart has continued to expand worldwide in brute force. The varying cultures across the globe that Wal-Mart attempts to move into have also proven to be very resistant. There have been cases of Wal-Mart not respecting the language or culture of the respecting community and they have closed their doors or taken a different approach including the purchase of well known local chains to retain a familiarity and business model that works. Analysis/Evaluation: The primary social stakeholders of Wal-Mart are the citizens in the community, local consumers, employees, local environment, American manufacturers, local small business and shareholders. The secondary social stakeholders are the local, state and federal government (state and federal due to Wal-Mart’s enormous financial impact on the U.S. Economy and its lobbying power), anti-Wal-Mart activists (including local community activists, broad-based activists against the spread of â€Å"The Wal-Mart Way†, and environmental activists), the media. Responsibilities Economical Responsibilities: Provide fair paying jobs, profit to shareholders with as little impact as possible on local merchants, purchasing from U.S. Manufacturers as much as possible Legal Responsibilities: Protecting Wal-Mart employees, protecting shareholders with sound business practices and limiting costly lawsuits that may affect their bottom line, comply with local/state/federal environmental and consumer laws. Ethical Responsibilities: Take into consideration the impact on local small businesses of the communities it moves into, listen and respect the wishes, concerns and cultures of those communities, reduce environmental impact. Philanthropic Responsibilities: Give back to the community and environment equal to or greater than what it has taken, continue to fund charities such as scholarships in proportion to the growth of Wal-Mart and its net profit. COURSES OF ACTION/ALTERNATIVES: †¢ It can save the local manufacturers from the episodes of global recession. But if purchases are made from other countries there are alternatives for a company. †¢ A revision should be made in respect of the benefits of the employees, which may render many jobless. †¢ Need to focus on development of employees irrespective of their gender. If not then there will be male dominant workforce and will effect the reputation of the company. †¢ Appoint a specialist team to detect the route cause to avoid future lawsuits against the company. VALUATION/SELECTION OF BEST ALTERNATIVE: †¢ Give an opportunity to small merchants to work with the company and it can be proved useful. †¢ Provide good benefits to the employees so that they are motivated to work loyally. †¢ Form an alliance with an external party to help solve the problems of the employees. †¢ Stop employing employees who prove to be a liability for the company. †¢ Avoid cheap labor by not employing illegal immigrants. †¢ Revision of benefits strategy. Limited risk initiative. IMPLEMENTATION PLAN: †¢ Purchasing from the local market at a reasonable price will lead to good business relations. Will increase the market

Ceja Vineyards Marketing Analysis Essay

eja Vineyards’ Decision to Directly Market to the Hispanic Community Analysis The Case Study, â€Å"Ceja Vineyards: Marketing to the Hispanic Wine Consumer?† by Armand Gilinksy Jr., Linda I. Nowak, Cristina Santini, and Ricardo Villarreal deSilva (2010) outlines a critical decision a small, family owned winery in California is facing. The winery, Ceja Vineyards, is located in the Carneros region and is equally owned by four Mexican born immigrants of farm workers. Amelia Moran Ceja, President, and her husband Pedro Ceja, Artistic Director, along with Pedro’s brother Armando Ceja, Winemaker and Vineyard Manager, and his wife Armando Ceja comprise the ownership team. Amelia, Pedro, and Armando grew up working in the Napa Valley vineyards, and in 1983 purchased fifteen acres in the Carneros region to begin their own vineyard. They planted their first grapes in 1986, and had their first harvest in 1988. From 1989 to 2000 they purchased additional plots of land and planted a variety of grapes. Their wine grape growing company is named Vina del Sol. They produce enough grapes for 65,000 cases of wine per year. In 2001, the company took another large step and began producing their own wine, under the branded name Ceja Vineyards. Their wine is made using their own grapes grown by Vina del Sol. In 2002, Ceja Vineyards was named â€Å"Winery of the Year† by a panel of ninety wine writers. Now it is 2007, and their wine production has doubled almost every year to the current amount of 10,000 cases a year. Problem Identification The key issue in the case study is whether or not they should make a concerted effort to target Hispanics in their marketing efforts. They see the potential of marketing to Hispanics due to the influx in Hispanic population in the U.S., and the continued projected increase. Their main concerns, are that they will have to change their marketing strategies, and incur substantial promotional expenses. They also will not lower their wine prices just to market to Hispanics. Amelia wants the company to focus on direct sells to the consumer so they don’t have to depend on the current distribution system. Analysis To understand the present situation Ceja Vineyards is in and to best recommend a course of action, three analysis techniques were employed. These three are the SWOT Analysis, Porter’s Five Forces, and Value-Chain Analysis. SWOT Analysis A SWOT Analysis was applied first to the situation to assess the internal Strengths and Weaknesses, along with the external Opportunities and Threats. Ceja Vineyards has a multitude of Strengths. Their ownership knowledge is based on a lifetime of real world experience. They grew up picking grapes, and control every aspect of the company guaranteeing top quality. They have a unique history, in that they are Mexican immigrants and the company is family owned. The vineyard is in a premier location. Carneros was the first wine region based on climate rather than political boundaries. Their wine is estate grown using grapes from their wine growing company, Vina del Sol. The company is debt free from years of solid investing and planning. They implemented a wine club, to be able to sell directly to the consumer. Ceja Vineyards is not without its weaknesses. Their small production amount limits their marketing strategies due to not being able to compete head to head with the mega-wineries. They also have limited distribution due to their size, though the emergence of Boutique distributors and their wine club has helped. As for external factors, Ceja Vineyards looks to have a plethora of Opportunities to increase their demand. They could target the ever growing U.S. Hispanic Market. There are currently forty million Hispanics in the U.S., 20% who earn more than $100,000 per year. They are also projected to be the fastest growing population for the foreseeable future. In 2006, they had to turn people away from a wine tasting in Los Angeles because of the demand. Hosting more of these events could be beneficial. Their wine club members receive a discounted retail price, but Ceja Vineyards could introduce a â€Å"Rewards Program† for recruiting new members. The wine market has exploded in the 2000s, and has produced quite a few Threats for Ceja Vineyards. Competition has become fierce recently as the number of wineries grew by 26% from 2004-2007. The â€Å"three-tier system† for distribution does not favor small  wineries. It places a different tax rate dependent on state, and the â€Å"Big Five† distributing companies hold 52% of the distributing market. Boutique distributors are not able to operate in all states, and are always at threat of being purchased by the major distributors. Ceja Vineyards has done well for itself so far, but there is always the threat of growing too fast, without the required demand. The SWOT analysis shows a very high amount of strengths and opportunities that would suggest an aggressive strategy if not for Ceja Vineyards personal business strategy of slow growth. Porter’s Five Forces Porter’s Five Forces was next used to determine the competitive environment. The Five Forces method is used to determine a company’s profit potential for a particular industry.  The Threat of New Entrants – High. Despite the high start-up costs, and that vineyards and wineries are a long term investment, it has not stopped people from joining the market. In 2006-2007, 12,000 new brands were introduced to the market. The number of imports in the U.S. market has also grown. Most noticeably, imports priced above ten dollars, that would compete with Ceja Vineyards, have grown â€Å"44 percent annually from 2005-2007† (Gilinksy Jr., Nowak, Santini, and Villarreal deSilva, 2010, p. 15). The Bargaining Power of Buyers – High. The main buyer of wines from wineries are supermarkets and warehouse stores. These location account for 80% of wine retail sales. Another factor that is increasing the bargaining power of buyers is that there are few key buyers since the, â€Å"retail sector witnessed considerable consolidation in the early 2000s, due to mergers of both supermarkets and liquor store chains† (Gilinksy Jr., et al., 2010, p. 14). The Bargaining Power of Suppliers – Low. Suppliers in this instance, mean small market suppliers. Gilinksy Jr. et al. (2010) states, â€Å"The top ten wine companies in the U.S. controlled 82 percent of all shipments,† so while the larger producers may have some bargaining power, it doesn’t allow any for smaller quantity producing entities. The Threat of Substitute Products and Services – Low. Ceja Vineyards location is its greatest strength against the threat of substitute products and services. While there are other wine products, and other companies that sell even the same type of wine as Ceja Vineyards, there are only so many that can produce it using Carneros grapes. In the wine industry, the quality of your grapes are your biggest asset, and each location produces a distinct flavored grape. People who prefer Carneros grapes will only have so many options due to its limited size. The Intensity of Rivalry among Competitors in an Industry – High. As stated previously, the wine market is growing each year, both domestically and internationally. As is the number of wine producers which is outpacing the market growth. This combination makes it harder each year to create a demand for your product with so many options available to the consumer. Value-Chain Analysis To understand if a company has a competitive advantage or not, a Value-Chain analysis can be performed on the company’s business model. For this report, we will only focus on the primary activities of the Value-Chain analysis Inbound Logistics. Ceja Vineyards is classified as an estate-grown winery, because it is located in the same place the grapes are grown. The vineyard that grows the grapes, Vina del Sol, is owned by the same group so this makes this portion of inbound logistics ideal. Being located in California, also helps with the inbound logistics of bottles, corks, and bottle labels because California has the largest number of wineries per state in the United States. This is going to mean any supplies needed for wine making will be readily available. Operations. The four owners consist of two married couples, and each has an equally weighted vote in any decision. They are also family, and live nearby each other making communication easy, in theory. They also grew up around vineyards so all have a deep understanding of what is needed to run the business. The quality remains high because according to Pedro, â€Å"we’ve done quality control over every aspect, from growing to the cork that goes  into the bottle† Gilinksy Jr. et al. (2010). The only improvement to the operations side would be if Pedro quit his day job and focused his full attention on the winery. Outbound Logistics. This is the area that is the main issue for the Ceja’s. The industry is set up to cater to the mass producing wineries. To mass distribute their product they would have to use the â€Å"three-tier system†, which would only pay them 50% of the retail value of their product. Other options are the boutique distributors, but they can’t distribute to the entire U.S. This is why Amelia wants to sell directly to the consumer through their wine club, and tasting room to cut out the middle man and increase their profits. Marketing and Sales. The grape producing side of their company, Vina del Sol, is doing terrific. The demand for it is very high as it already has five companies on the waitlist to buy grapes. While, Ceja Vineyards sales have doubled each year since introducing their branded wine it is hard to judge the ceiling. This is mainly because the company has grown slowly, and been vigilant of growing too fast. The company realizes though, they have to decide on exactly how to market their product though if they want to continue increasing demand for it, and that is the issue we are trying to solve. Alternate Solutions The Ceja’s have multiple options they could take, and still be successful. The easiest option would be to change nothing. They have increased their revenue and profits each of the past three years according to their income statements. Also, they stated they had doubled their wine sales each year, and were ranked number 2 in Wine Business Monthly’s Hottest New Small Brands. With the growing wine market and critic accolades, they would probably continue to grow without changing anything. They could decide to target the entire Hispanic population, and market heavily. This mass marketing strategy would reach the most people, but would be very expensive. It would require an understanding from all the  owners that it could produce significant losses during the transition period. They could look at Round Hill Vineyards & Cellars as a blueprint. They did an ethnic outreach program in 2004 to target Hispanics and Asians. Their total case sales increased 400 percent from 2005 to 2006. Ceja Vineyards could work directly with their current Wine Club members, asking them for feedback on what made them join. Offer the members rewards for purchasing so many cases a year, or recruiting new members. Currently, half of the wine clubs 1000 members are of Hispanic descent. They could speak directly to this portion of the group to try more of a grassroots marking campaign. Ceja Vineyards could also market to only a portion of the Hispanic community. Since they refuse to lower their prices, they could market to the nine percent of Hispanics that make up the â€Å"mostly acculturated† percent of the Latino population. Wine consultant Sandra Gonzalez stated, â€Å"these Hispanic wine consumers are 96 percent more likely to spend $20 or more a bottle than non-Hispanics.† (Gilinksy Jr., et al., 2010, p. 14). Recommendations Ceja Vineyards in the enviable position of being a growing company with no debt in a growing market. After analyzing Ceja Vineyards’ business model and the state of the external environment, Ceja Vineyards should market to the Hispanic population. As of 2005, there were 12.5 million Hispanics in California alone. This is an enormous untapped market that if tapped into would allow Ceja Vineyards’ to rely less on the big distributors and more on direct to consumer sales. Ceja Vineyards’ should continue to grow their Wine Club through the use of promotions and a reward system, while also reaching out to the â€Å"mostly acculturated† percent of the Latino population. They should also look into the marketing strategies Round Hill Vineyards & Cellars employed to attract Hispanics and Asians to their brands.