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Introduction:
Pfizer Inc. is a research-based diversified health care company with operations around the globe. Pfizer Inc. has three main business groups. They include the Consumer Health Care Group, U.S. Pharmaceuticals Group, and the Pfizer Animal Health Products Segment. For purposes of this case, we will discuss the Animal Health Products Group, where in 1998, accounted for twelve percent of the company’s revenues.
Industry Background:
The process for making beef begins with the ranchers breeding and raising cattle, in order to sell them to feedlots. The ranchers’ goals are to minimize death of the cattle, to breed low birth weight calves, to produce grade A choice beef, and lastly to produce calves that gain weight quickly. By the time the feedlots purchase the cattle, the more the cattle weights, the better. The next step in the process after the feedlots purchase the cattle is for the feedlots to sell the beef to the meatpackers. There are four main meatpacker companies that account for eighty percent of the entire industry. The meatpackers act as a middleman between the producer and the consumer. Since the majority of this industry is controlled by a few companies, this creates a problem because they act similar to a monopoly. Due to this monopolistic view, there is no free-flow of information throughout the supply chain and beef prices tend to be higher than they should. After the meatpackers have packed the beef, they sell it to retail stores, which in turn sell the meat to us, the consumer.
Industry Trends:
There are a variety of trends that directly influence the beef industry. To begin, changes in consumer lifestyles include less time for home-cooked meals and society’s increased pressure for time; thereby, having a big impact on the decline of consumption of beef. In addition, consumers have increased dietary considerations for health and nutritional issues that lead them to consume alternative meat products like pork and poultry. Furthermore, the marketing strategies of the pork and poultry industry have done a better job advertising than the beef industry. Also, the pork and poultry industry have recently produced more ready-to-eat and branded products. Even with all of this new increased pressure on the beef industry by the pork and poultry industries, retail prices for beef have still remained high, yet ano...

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...less today than ever before, beef will always exist, therefore, Pfizer products will be needed. An added reason for them to continue with their cattle/calve health products is due to the fact that Pfizer has already invested heavily in this industry and makes over sixty health products for cattle. Additionally, we also recommend that Pfizer maintain their strong market share by continuing to sponsor seminars, publish educational material, offer technical support and organize management programs for the health care of cattle.
Conclusion
To conclude, the beef industry is currently experiencing a decline in demand, thereby directly affecting products sold to ranchers made by Pfizer’s Animal Health Group. This decline can be attributed to a variety of factors outside of Pfizer’s control, including social, economical and governmental issues regarding beef. Since Pfizer is limited in what they can do to increase beef sales, our proposal is for Pfizer to enter into making health products for poultry, given that this industry seems to be on the rise. However, at the same time, Pfizer should continue to be active in the beef industry to keep them at the top.
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