Azalea Seafood Gumbo Shoppe is part of the seafood packaging industry. In this industry, companies collect raw materials from the sea and package them to sell to supermarkets, grocery stores and restaurants. Although Azalea makes direct sales through catering, the majority of its revenue comes from the wholesale sale of its food (Appendix A). Large companies in the sector generally work through a food broker who will sell their products to supermarkets or grocery stores. A major advantage of using food brokers is that it is possible to organize preferred shelf placement, which facilitates sales. For small businesses in the sector, like Azalea, it is difficult to access food brokers because they do not handle a high enough volume. Azalea initially found its niche in the market by gaining access to seafood from the Gulf of Mexico and selling in Mobile, Alabama, where seafood was a staple. The company has increased sales and profits in each of the past four years, until the most recent year when sales fell 15%, resulting in an 18% decrease in profits (Appendix A). The challenge for Azalea going forward is to develop a strategy that will allow it to consistently increase its profits. The key success factors in this industry include on-time delivery, product quality and brand recognition. Supermarkets and restaurants cannot afford to leave their shelves empty for even a moment. For a company in this industry to be successful, it must have a model that enables on-time delivery. This must be combatted by taking into account the cost of maintaining high inventory levels and the risk of wasting inventory that is no longer fresh enough to sell. Forecasting product demand is essential for any business in this sector in order to have sufficient inventory to supply, without creating profit by eating paper in the middle of supermarkets and grocery stores. The latter source of revenue could decline if more people eat out. The consolidation of supermarkets and grocery stores will give these stores greater bargaining power and more demanding needs. Azalea may not be able to meet these needs without additional growth. In addition to supermarket and grocery store consolidation, consolidation among competitors could also negatively impact growth opportunities. As companies like Nestlé and Kraft Foods acquired smaller companies, they created a more concentrated seller's market. The increased concentration of buyers and sellers in the industry will require economies of scale to succeed. Azalea will struggle to grow enough in its current environment to achieve the economies of scale necessary for continued success in the industry..