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PRESENTE
D BY
GROUP 9
Q2,PRIMARY GROWTH
STRATEGY
INTRODUCE NEW SKUS OF
CHILDRENS MULTI PACK INTO
THE NATURAL FOODS CHANNEL
Growth : Average of 20% per
year
Connect : Leverage
relationship with existing
channel retailers
Profit Contribution :
Financial potential was most
attractive
Positioning : Sales team was
confident to achieve required
distribution
Resources : no additional
skill sets was required to
implement the strategy
Q3,Financials
Revenues
Current
Option 1
Change in Revenue
Increase in COGS
Gross Profits
Expenses:
Adminstrative/Freight
Sales
Marketing
R&D
Trade Promotions
Total Expenses
Investment Required
Net Income
13,000,000
Option 2
Option 3
38,900,000
27,850,000
19,030,000
25,900,000
14,850,000
6,030,000
8,190,000
19,040,000
13,635,000
10,260,000
10,850,000
5,445,000
2,070,000
4,810,000
19,860,000
14,215,000
8,770,000
2,210,000
2,330,000
1,560,000
1,760,000
390,000
640,000
390,000
1,200,000
490,000
(Assumption of R&D
expense=100,000)
1,560,000
870,000
390,000
2,210,000
1,720,000
2,790,000
390,000
2,210,000
2,560,000
870,000
1,024,000
4,550,000
9,340,000
8,774,000
4,900,000
4,790,000
4,224,000
350,000
260,000
10,520,000
5,441,000
3,870,000
Risks:
High cost of trade promotion
High marketing expenditure
Huge advertising budget
Increase in sales, general and
administrative expenses
Do not have necessary
resources to move to
supermarket channels
Channel Management &
Conflict Issues:
Natureviews brokers can take
advantage of relationship with
supermarkets in Northeast and
West
Loss of trust by natural and
organic stores
Risks:
High slotting expense
Inhibitions of new users to
readily enter the brand
Increase in sales, general and
administrative expenses
Channel Management &
Conflict Issues:
Concerns about sales teams
ability to achieve national
distribution in just 12 months
Risks:
R&D and operations need to
develop the new product
Natural food channel making
similar demands as
supermarket channel once it
grows
Channel Management &
Conflict Issues:
Confidence of sales team to
achieve distribution of the two
SKUs
Implementation Adjustments
Brand: Do not loose brand positioning and equity- premium tag of product
Channel Partner: Provide beneficial schemes to natural food retailers to help them
better compete with supermarkets.
Marketing mix: 4Ps - 8oz SKU, $0.78, Located in-store with competitor brands, In-store
promotions
Sales: Implementing latest technology advancements to track sales trends and
developments in the market
THANK YOU!!