Neptune Gourmet Seafood¡¦S Supply Problem Essay

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Abstract Neptune Gourmet Seafood is facing a problem with oversupply for existing demand. It can either decrease supply to match demand or increase demand to match supply. I recommend the latter. I further recommend the way to increase demand is for Neptune to increase its marketing efforts in its existing markets and to penetrate other markets it currently is not in. The Competitive Environment Neptune is a 40-year-old, $820,000,000 company, specializing in quality shell and non-shell seafood in a $20 million industry. It is North America¡¦s third-largest seafood producer, but that designation is misleading, because its revenues account for only 4.1% of the total market. As such it is but one of many firms operating in the…show more content…
Restaurants account for 66% of the company¡¦s revenues, but one-half of that is to local restaurants. Clearly, there are some untapped markets for the company¡¦s existing product line: more mid-west and eastern seaboard grocery chains, west coast grocery chains, and more restaurants throughout the United States, not to mention Internet sales to individuals and those seeking ready-to-eat, fish-based meals. The Fundamental Environment One of the major reasons for Neptune¡¦s current oversupply dilemma is because of changes in its fundamental environment: legal and technological. The legal change is new U.S. laws limiting the company access to fishing grounds near the coast, forcing it to go farther out to sea. The technological change is the addition of new more efficient fishing trawlers. As a result, the company is fishing in waters where supply is more abundant. They are using the new and more advanced fishing trawlers that allow them to catch more fish. In addition, the trawlers¡¦ more advanced refrigeration techniques enhance the shelf life of the catch, up to 50% longer. Major Market Drivers There are varieties of market drivers contributing to the current dilemma as well as to the solution to the problem. The rate of technological change, increasing industry globalization, changes in cost and efficiency, and regulatory influences all have
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