Case Analysis : ' Terracycle Inc ' By Jon Beyer And Tom Szaky

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TerraCycle Inc.

In 2001, Terra Cycle was produced by Jon Beyer and Tom Szaky, both Princeton University students. By 2003, Tom left school to pursue the business of TerraCycle full-time basis. The growth process was slow in its infancy stages, but by 2006 several companies became interested in the TerraCycle concept for the All-Purpose Plant Food. It was now necessary for the chief financial officer (CFO) Betsy Cotton to discuss the future opportunities of TerraCycle the Trenton New Jersey company (Clow & Baack, p. 41).
TerraCycle’s name is derived from the word Terra which means planet earth and cycle which means any complete round or series of occurrence that repeats or is repeated according to Dictionary.com. TerraCycle created a
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43). There were other plant foods on the market that were selling similar products comparable to the All-Purpose Plant Food. The two competitive gardening products were Scotts Miracle-Gro and Spectrum brands (Clow & Baack, p. 45). Miracle-Gro was a substance that when added to water became a fluid matter used to grow and feed plants (Clow & Baack, p. 46).

When conducting a competitive/industry analysis, what are TerraCycle’s primary advantages? What are the company’s main weaknesses when compared with the competition?
TerraCycle’s advantage is that they have an organic liquid plant food and their product process was natural and environmentally friendly (Clow & Baack, p. 43). TerraCycle’s main weakness comes from not marketing to the commercial growers; instead the All-Purpose plant food was for small gardeners (Clow & Baack, p. 47). Also, TerraCycle did not have a market for direct sales, therefore they were negotiating deals with retailers to keep an ongoing relationship. This relationship was passive because retailers were not paying TerraCycle in a timely manner and they were lenient on returns (Clow & Baack, p. 47). Products were being returned and this could be thought of as either controllable returns or uncontrollable returns. Thus Kotler & Keller denotes that lenient return policies encourage customers to make additional purchases and helps spread the word about the company to others, therefore creating a win-win for both the

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