Flare Fragrance

2932 Words12 Pages
Analyzing Flare

Fragrances Co., Inc.

Joseph J Fortunato CR 504
Marketing Management
May, 31, 2011

About Flare Fragrances: Flare Fragrances Company, a small women’s perfume manufacturer, was started in 1955.
Since inception, Flare has grown to be the #4 player in the U.S. women’s fragrance market. For 2008 EOY estimates were $221 million dollars up 2% over 2007 sales. In 1975 Flare introduced the brand “Loveliest” which was their sole focus until 1996 when they introduced “Awash”. Since that time, the company introduced a new fragrance every three years with Loveliest on the label. Early on Flare fragrances sold its brands through premium and mid-tier department stores until the late 1970’s when Flare moved
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Product Line: Eau de Parfum initially; to be followed by bath soap and body lotions.
Retail Price Point: $40 for 1.7oz. Spray bottle. Variable cost structure similar to other Flare Fragrances.
Trade margin: 40%
Introductory Deals: 5% and 10% off-invoice allowances on small and large size prepacks, respectively. Sales of each prepack were expected to account of 1/3 of 2009 Savvy sales.
Sampling: Production of 1 million 1/8 oz. samples to be distributed free at the point of sale at a cost of $400,000.00
Merchandising Aids: Counter display materials, brochures, and testers at a cost in 2009 of $100,000.00.
Timing of Launch: First orders excepted in 2009; first shipments in September 2009.
Sales Target: Gross factory sales of $7.5 million in 2009.

In analyzing this new product introduction recommendation a few things come to mind based on the findings of Arlmont Associates as well as the focus group findings and the wants of the company’s founders. Flare fragrances typical new product introduction has been every three years and this new launch is on target to meet the new introduction schedule. Although doing nothing or concentrating on drugstore expansion are options, if bringing the company public is the ultimate goal of the companies founders, then historically, especially for investors, it is critical to maintain Flare’s historical product launch schedule. If the company does not it would appear that there are problems internally and
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