preview

Truearth Case Analysis

Better Essays

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

Get Access