In today’s business market, it is imperative for companies to invest in new product development in order to continuously grow. There are various factors, which come into play when it comes time for a company to make such a decision. In the case of TruEarth Healthy Foods, time has dwindled and they must make a decision whether to release their new refrigerated pizza line or not. Unfortunately, according to statistics launching a new product has an 80% fail rate. In addition, it can be a very expensive process needing special attention from management. Overall, TruEarth’s main concern here is whether or not it would be profitable venture to move forward with the launching of the new pizza product. The factors that need to be considered …show more content…
In order to adjust the price of pizza we could include toppings as part of the kit. This would lower packaging costs because there would only be a single item being packaged and subsequently easing the decision making process for the consumers. Manufacturing Viability Another factor that must be taken into consideration is the manufacturing /packaging equipment needed to accommodate the fresh pizza product. Coincidentally, the large capital expenditure in packaging equipment is already available due to the fresh pasta line. This makes the incremental investment for pizza substantially less than it was for pasta; however, it still included some re-tooling costs and marketing plan. Another benefit is that employees already know how to operate current machinery. This minimizes the training costs significantly. Furthermore, 22% of respondents claimed the sauce was the key reason for purchase intent (Exhibit 9). The company can utilize the pasta sauce they are currently making for the pizza as well. In addition, consumers have reported 31% favorability that the pizza is freshly made (Exhibit 8). To ensure freshness of any product, strict manufacturing schedules must be implemented in addition to frequent maintenance of machinery. This is a minor concern among consumers with 12% (Exhibit 8). In retrospect, using the same machinery for two different
IntroductionMy name is Kevin Chen and I am a senior consultant of the Boston Consulting firm. Per the request of the A/S Dansk Minox, a food products manufacturer, I am preparing this analysis to identify the existing problems within the business of A/S Dansk Minox and provide possible recommendations. As a consultant, I will present the analysis without bias and for the best benefits of A/S Dansk Minox. In the following analysis, I am going to answer the following question: Should A/S Dansk Minox bring the new product, complete meal, to the market?Company backgroundThis case is set in Denmark in 1967 when the "boom" in consumer food products was just beginning more working mothers, more disposable income, more choices in convenience food
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.
“Hi, welcome to CiCi’s!” This is the warm greeting that every CiCi’s employee will welcome every customer with when they walk through the door. This warm welcome is just one of the many things that CiCi’s does to exceed the customer service expectations that come with a buffet style restaurant. With competition lurking, and the economy pinching, great customer service has become a premium. This is why CiCi’s focuses so much on the customer’s wants and needs. The mission statement
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
The Pillsbury Cookie Challenge is a case study written by Natalie Mauro under the supervision of Professor Allison Johnson. The case study creates an open discussion about what the marketing manager of the refrigerated baked goods category for Canada General Mills should do to revive his products. Ivan Guillen, the marketing manager, was faced with tough challenges. He was initially “…faced with the challenge of developing a strategy that would lead to improved business performance on his category” (Johnson and Mauro, p.1, 2011). To clarify, Guillen’s category is refrigerated baked goods (RBG), which means, this category is his marketing responsibility. The issue here is that “RBG was GMCC’s fourth largest category, and its performance over the past two years had been less than stellar” (Johnson and Mauro, p.1, 2011). It is important to note that GMCC stands for General Mills Canada Corporation. Pillsbury has enjoyed majority market share in the RBG category in Canada, however, recently, the market was experiencing only moderate growth. Guillen was disappointed that their goal of 5%-7% market growth was not being achieved mainly in the refrigerated cookie dough segment. To be exact, their volume growth for two years was flat and they were having difficulty reaching new households. There was a shift among consumer’s purchases, which Guillen was challenged to figure out why.
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
Exhibits 6, 8, 9, and 10 provide a great deal of information to TruEarth Pizza, including several necessary areas of continuing product development. Creating more appealing varieties and finding a way to increase the convenience factor, for example, would be excellent ways to improve customer response to the product. There are other, more distressing problems that suggest the entire model might be flawed and ultimately unprofitable: two of the most substantial dislikes of the
Inventory control is the biggest challenge because of inappropriate inventory management system. There is a requirement of proper food service for better inventory control and also for identifying the important requirements. There is a need to develop the inventory methods for the products and with a standard inventory management company should try to minimize the wastes in terms of future. (Gartenstein, 2012)
In a growing ethnic food category, NRFC is facing the decision of launching or not Contadina fresh pizza. Study has shown that business viability is closely depending on brand penetration rate which is not accurately measured. Moreover, NRFC try to get the first mover advantage to face the expected concurrence of Kraft. Product is facing positioning problem, and if the launch failed, it may affect brand awareness and be harmful to its pasta line. NRFC should resolve positioning problem by finding the right price that increase sales reduce dependency to brand parent and ensure product
of a crust-free pizza; we saw it as a significant marketing advantage." So a new product
The market studies consisting of the forecast of the estimated demand show that the pizza
of pizza they will serve in the kit both in terms of crust and toppings.
Frozen food division (FFD) is the key contributor to Giant Consumer Product 's (GCP) profits which have successfully grown over the past 30 years. The company has two main products lines, Italian frozen dinner “ DinardoTM”, and organic frozen foods “Natural mealsTM ”. However, recently FFD has encountered a shortfall in sales volume and
For instance, it is very important for the company to come up with marketing campaigns aimed at increasing popularity of its pizzas so as to counter the competition. Promotional pricing should also be undertaken which will help to generate higher sales. In addition, Dominos need to be creative in ensuring that its pizzas are attractive even at a time where consumers are healthy conscious. For example, the company could review the recipe for preparing its pizzas to ensure that healthy oils are used and that their calories content is minimal. This should then be the communicated to the target market with an aim of winning the customers who are overly concerned about healthy
Starting a new product is never easy for a company. The difficulties they face are diverse in nature, and often they lack initiatives so that customers are not interested in the product.