Grupo Bimbo SWOT & PESTLE Analysis

Strength

1. Exceptional distribution network across 30+ countries: Grupo Bimbo produces around 13000 products (fresh and frozen), houses 100 and has an outstanding, also the largest digitally driven, supply chain network, with more than 3 million point of sale on 58000 routes. In terms of logistics and supply chain, Grupo Bimbo has been trying to optimize transportation and make it more efficient and sustainable. The distribution network is being reshaped by introducing digital applications like ERP software and Oracle Cloud to manage inventory. Grupo Bimbo has become much quicker and more flexible in managing their logistics operation. Artificial Intelligence has also helped the company to improve on demands and forecasts. This has ultimately increased the decision making power which in turn benefits customers worldwide. Grupo Bimbo is making sure that instead of products having low shelf life or short life cycle it reaches every retail outlet and every customer every day and that too in its fresh form. Grupo Bimbo has been aiming to get a place in Gartner’s global ranking for its Supply Chain and Logistic Operations through increased efficiency and optimization in distribution process.

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Weakness

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Opportunity

1. Frozen food market is the new opportunity amidst COVID’19: Frozen food like ready to eat meals, sea food, soups etc. can be a very new segment for Grupo Bimbo. The current market value for frozen food is US $280.2 billion. It is expected to grow at a rate of 4.5% over the next 6 years. Grupo Bimbo’s solid financial position and an exceptionally well optimized supply chain and logistic operation can become boon if they venture out into the frozen food industry. Retail industry like supermarkets, convenience stores etc. have contributed in increase of sale of frozen food. Frozen food market also has different segments based on product type and consumption type. Ready to eat type meals have seen the fastest growth in this industry.

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Threats

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Political

1. Violence and political instability in LATAM region: LATAM and in particularly Mexico has been a center of violence related to illegal drug cartels. This has increased the security cost of the company. Mexican government has always been accused of being in constant link with criminal organization and corruption which affects the Grupo Bimbo’s operation both in Mexico and overseas.

Simultaneously, Grupo Bimbo had an adverse effect on its operations in Venezuela. Venezuela is undergoing a huge political instability and recently financial sanctions has been put on this region by US making things more difficult for Grupo Bimbo to carry on with its operations. As of now Grupo Bimbo does not consolidates subsidiaries in this region. In Venezuela, Grupo Bimbo is facing adverse conditions like high operating cost, restriction on importing raw materials, etc.

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Economic

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Social

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Technological

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Legal

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Environmental

1. Focus on renewable energy and waste management: Grupo Bimbo has a target of reaching 100% electricity renewable plants by 2025. This Company has been using wind farm and solar farms as the main source of energy. Grupo bimbo has also set a target for itself to reduce water consumption by 30% in 2020. Grupo Bimbo plants have 57 rainwater collection systems and 74% water is being reused after getting recycled at 228 water recyclers. Total Volume (TV) of water treated is 556,804 m3.

Grupo Bimbo is also working on waste management system. The target for 2020 is 50% reduction in food wastage and 90% recycling along with recycling waste, Grupo Bimbo has also introduced 97% products with oxo-biodegradable packaging.

The remaining section of “Environmental” is available only in the 'Complete Report' on purchase.