CASE STUDY
A yoghurt manufacturer, Natureview farm is facing a major problem trying to find a way to increase its revenues by over 50% prior to the year-end of 2001 (Fleming & Harvard Business School, 2007). The main focus of the Natureview management team was to determine whether they should extend their investment and markets into supermarket channel so as to attain their revenue objective which would greatly affect the company’s business strategy (Fleming & Harvard Business School, 2007). Nonetheless, the company is facing a challenge in raising enough funds to finance this project since growing the company’s revenue from $ 13 million to $ 20 million is quite costly and difficult for them to manage on their own in one year (Fleming & Harvard Business School, 2007). Natureview Farm has always considered themselves being inferior, incapable and underdeveloped to meet the consumer demand that would attain the volume requirement of yogurt packages for distribution to warehouse clubs and supermarkets. The company as well as facing a steep competition from other yogurts manufacturing companies such as Yoplait, Columbo, Dannon, and Beyers (Fleming & Harvard Business School, 2007). The following are recommendations that will help to address this problems: The company should come up with a proper strategy that will enable them to effectively get into the supermarket channel while not compromising the existing strategy. Natureview Farm should find more investors to help them fund their strategy. Natureview Farm should also improve the quality of their products and try to be unique from other competing companies so as to gain a competitive advantage.
Finding more investors to fund Natureview’s strategy is important as it will enable the company to achieve its target making it a success. This is because the company aims at making a significant growth in their revenue within a short time period of one year which is costly that will strain the company. Like way back in 1997 Wagner the company’s chief financial officer recommended that the company had to organize for an equity infusion provided by a Venture Capital firm in order to finance their strategy (Fleming & Harvard Business School, 2007). No one questioned this recommendation as it was determined to be the best option that Natureview firm had. To gain a competitive advantage against the major competitors such as Beyers, Dannon and the rest, Natureview should try to improve their quality even further and be more unique. Just like before, Natureview improved the quality of their yogurt to last for 50 days, unlike other companies’ yogurt which last for only 30 days (Fleming & Harvard Business School, 2007). This helped them to thrive in their business.
To achieve the company’s goal, the company will have to come up with a sound and effective strategy then find investors to fund the strategy. The company will also have to produce more products to meet the supermarket channel demand. The company will have to find brokers and use their knowledge in promoting their products and learn the merchandising requirements. The company will take into consideration the $0.74 charge by the supermarket when setting their prices. In terms of pricing, the company will have its own competitive and affordable price for its products. The yogurt price will be 5% lower than those of the other competitors. Natureview Farm will consider advertising its products through various means such as the internet, media, and billboards in order to attract more customers. The company as well will launch promotion campaigns outside or within supermarkets with its sells agents advertising their yogurt.