Dragon Soup should increase the regular price of soup. The sales team is confident they will be able to sell soup at any price due to the cult-like following of The Clangers. Dragon Soup then just needs to find the optimal price per can for their purposes of maximizing income. Based on the spreadsheet, a price of $1.99 per can maximizes Gross Profit at $547,298 (Net Income of $207,354). On the other hand, Net Income is maximized at a regular price of $2.15 per can, producing Net Income of $226,740 (Gross Profit falls to $516,783).
After a period of declining sales for Allround, we increased the advertising budget to be consistent with our competitor’s budget. We decided to be very consistent with our strategy over the ten periods; however, in hindsight we should have implemented a more dynamic strategy that factored in the changing
Cranfield Inc. is a leading producer of juices for range of cranberry cocktails. After a market research experiment Cranfield Inc. has many different business decisions to make. One to introduce a new line called lite cocktail which requires space and machinery and will eat into sales of currently offered products. Or not to introduce the new product and lease out it’s space, or do nothing to save the space until it’s needed for its current product line.
Introducing a new product to the market is a very risky operation. Not only is it risky but it takes time, effort and money. In order for a product to be successful, it had to fully undergo the product life cycle. Kellogg’s has an advantage when it comes to the breakfast market as it holds the biggest market share. After providing the British public with breakfast for years, it most certainly has a larger customer loyalty base. The strong brand makes it easy for product launching as the public are already familiar with the brand. However, introducing a new product comes with its challenges and risks. Looking at the ratios, Kellogg’s has a current ratio to date of 1:1.1 . This in financial terms rings alarm bells as it shows that the company will struggle to pay its short term obligations. Kellogg’s however can operate on a low current test ratio as it has a good long term revenues coming into the business. This means that it is possible to borrow on this basis to meet its current obligation. After calculating the net present value, which gave a positive NPV of £38450million, I move that we go ahead with the introduction of a new product. In traducing a new product is a sign of innovation and growth on the part of the competitors. In order for a new product to be introduced to the market, Kellogg’s will have to spend money on the actual product, the marketing side of
Changes in customer preferences, general economic conditions, discretionary spending priorities, demographic trends, traffic patterns and the type, number and location of competing restaurants have a moderate effect on the restaurant industry (Chipotle, 2010). One example of customer preferences being a driver in the industry is the “Whole Food-ism Movement” which has put a large focus on organic, antibiotic-free, and non-processed foods (Mansolillo, 2007). Consumers now look for healthier options when eating and an overall healthier lifestyle. Chipotle has been able to benefit from this movement by carrying on their “Food with Integrity” mission (Chipotle, 2010).
The majority of baby boomers' diets are comprised of low sodium. A recent study shown that high cholesterol, attributed to high levels of sodium intake, is the number one diagnosed health condition for the baby boomer generation. The condensed soups have one of the highest sodium contents of all processed foods in existing market. Therefore Campbell's low-sodium products have differentiated themselves with many rivals. Besides sodium, Campbell's also has to focus on other aspects such as MSG and low calories of its soups by hoping that these healthier offerings will help gain market share among younger, more health conscious consumers. (Campbell CSR Report 2008)
Also, according to break-even analysis operating with the single mold and excluding warehousing costs, a minimum of 12,035 units must be sold to break even. Under a similar situation with the double mold, 15,507 units must be sold to break even, which is about half of the optimistic sales projection. Also under the optimistic sales projection, a positive return on investment is expected. Because the company is turning proﬁt,less additional investment is required. Additionally under the pessimistic and expected situation, the company turns losses, and under the optimistic projections, Chef’s Toolkit only has a net income of 13% of its revenues. Selecting Preferred alternative According to the above information and the projected pro-forma statements, Dale Reid should not invest his money in the company. The company’s lack of current assets, high expenses and low per-unit revenue create an unfortunate and unproﬁtable investment in pessimistic and expected situations. Only in the optimistic production and sales does the company begin to turn proﬁt, but this proﬁt is low. Chef’s Toolkit needs desperate restructuring and additional revenue sources before Dale Reid should invest. Developing
The second problem that happens after the establishment of advertisement is the individual’s keen urge to have a huge sugar and sodium intake. Sodium is a serious rising issue, which is becoming more difficult to curb due to the food industry heavily prioritizing frozen, preserved, and processed foods. When these types of foods are ingested and have high concentrations of sodium intake, which causes people’s blood pressure to increase, and high blood pressure is a major risk factor for heart disease and stroke, the two leading causes of death in the United States. Average sodium intake in the U.S. is approximately 3,400 mg a day. American’s consume 50 percent more sodium than experts would recommend. Sodium is found 65 percent of the time in
Brannigan Foods soup division general manager Bert Clark was in charge of bringing their company out their recent decline. The company had seen steady decline in division sales, market share, and profitability over the last three years. He was in charge of moving their division’s growth back up to 3-4% per year and his team had come up with four different plans for doing this. It was Bert’s responsibility to review the benefits and costs of each plan and choose the most effective way to grow the company.
We cannot neglect the fact our production rate is only operating ay 90% efficiency. By increasing efficiency, we can increase our output quantity, which should have a direct effect on top-line revenues. To consider what needs to be improved, we should evaluate the Theory of Constraints. The three major constraints for Soup King’s production are 1) the type of equipment we use to produce our product, 2) the people operating the equipment, and 3) our set policies/computer-programed instructions. While Soup King does not fully follow the lean-system (the reason being we are not further consolidating out facilities), that does not mean we can’t incorporate its strategy of removing waste and inefficiencies are stemming from in the production line. Starting with the equipment, we are producing a product mix of chicken noodle and tomato soup. With two products, it is infeasible to have both products packaged on the same line. We need to conduct internal benchmarking tests at each of our plants to see if bottlenecking is slowing down our supply chain. If we alternate production
I propose that they have a contest to develop new flavors of soups, with the winner receiving a combination price of money and a year’s supply of Brannigan Foods Soups. Buying up smaller brands of soups doesn’t sound feasible seeing as how it hasn’t worked at any time before for this company. Another option is to seasonalize the soups to allow for new flavor varieties to be introduced in spurts. Heartier (potato, noodle and cream) soups are desired in the winter, where as a gazpacho is in a higher demand in the summer. Allow consumers to take surveys to receive coupons for your products and ask them what they want in a soup.
We will use the following framework to help analyze and evaluate the possible strategies Anton should follow, ultimately coming to a final marketing strategy and reasons for pursuing that strategy:
Nevertheless, as a recommendation, the company could re-evaluate their long-term financial objectives and consider focusing on short term goals to pursue in the next two years. By concentrating sales on one particular product or service which offers the most appreciable profit, it could potentially elevate the annual income, yet this strategy is only realistic if all other subdivisions of the company continue to
Hausser Foods is clearly experiencing a decline in sales growth due mostly to competition and a decline in population growth. The case focuses mostly on the southeast sales region; however the decline in sales growth is affecting the entire company. The lack of new ideas by the sales force is primarily due to a lack of reflective and adequate encouragement from HDQ as well as a fear or concern that such new ideas for sales revenue might actually burden the sales force in the following year through increased sales targets.