The value added seafood industry

The biggest change in the competitive arena for value added seafood industry involves competition from large, multi-national food companies including Kraft Foods, NestlT and Unilever. These large food companies continue to acquire smaller companies in order to fill what these companies see as gaps in their product lines. Seafood is becoming a more popular and more important part of the American diet. This is partly because of taste, and partly because seafood is considered to be healthier than red meat and other sources of protein because of its low fat content. As a result, companies such as Kraft Foods are beginning to look more seriously at opportunities to penetrate the specialty seafood business. These food manufacturing giants want to increase market share in order to gain additional economies of scale when manufacturing products for distribution to supermarket distribution centers and food wholesalers.

ational chains. The company already has lost two potential customers when buyers from two different restaurant chains visited the Azelea's manufacturing facility and were unimpressed. The challenge is to decide whether or not to make the substantial investment that would be required to modernize and expand the company's manufacturing facilities. Expanding production represents new marketing opportunities for the company. At the same time, expansion would radically change the company and may actually be a threat to the company's future well being. The challenges posed by a decision to expand go beyond finding the money needed to expand; the decision to expand would present additional challenges. One of them would be to determine how quickly Azelea can capitalize on this increased production capacity to increase sales revenues. One of the most fundamental questions is how large the company should become. Accompanying any discussion of expansion are these issues: Can the company acquire the raw materials needed to increase production? Will the company's suppliers extend credit or require payment on delivery? Would increasing production capacity cause any interruption to the current production process? If so, how can di