Thursday, November 14, 2019
Zoecon Corporation - Strike Roach Ender :: Case Study, solution
To:          Executive, Zoecon Corporation From:           Date:          Thursday, February 17, 2005 Subject:     Strike Roach Ender Introduction Projected Industry Consumers                              Professional Projected Growth Rate of 10% annually          Projected growth rate of 8% annually Projected sales of $4.4 million                Projected sales of $2.7 billion Flea IGR Introduction – Similar Scenario †¢Ã‚     Great success of introduction of flea IGR PRECOR into PCO, veterinary and pet store markets. †¢Ã‚     In 1980 Zoecon broke into the supermarket segment by selling the PRECOR ingredient to it’s competitor dCon †¢Ã‚     In early 1983 Flea Ender (using PRECOR) was introduced to supermarkets by Zoecon – 11 % of the market was captured by late 1983 †¢Ã‚     Flea Ender’s success attributed to a second 3rd party competitor S.C. Johnson †¢Ã‚     By 1985 Strike Flea Ender had captured 18% of the flea pesticide market and continues to achieve it’s profit objective Consumer Test Market Analysis Zoecon’s introduction of the Strike Roach Ender has captured a substantial portion of the test area household market segment. As seen in Table A the brand was recognized by over half of the households in the market and 6 %,( 70,200 households) of those households purchased the brand, resulting in a profit of $ 247,180.40. Though repeat purchases were also high at 30% (21,060 households) the profit generated was not enough to sustain a revenue in the trial market. Zoecon ended the market in a net loss of $$1,230,819.40. Figures are further broken down in Table A. Contribution margins were also high for Strike Roach Ender. Aerosol Strike had a contribution margin of 55.1% and fogger had an even higher margin of 57% as seen in Table B. Table C projects the break even analysis in both units and dollars as a basis for further projections. As seen in Table C substantially larger sales are required to break even. Industry Market Analysis Using the techniques from the test market estimates of market share and projected sales for the 19 city (80% of trial insecticide volume) are made for the introduction of Strike Roach Ender into the household market. I also chose to increase the advertising budget by 20% which increased costs to upwards of $12 million. This further drove the net loss to a final projection of $6,844,476 as seen in Table D. Much like the test market Contribution margins were also high for Strike Roach Ender. Aerosol and fogger Strike had a contribution margin exceeding 50% as seen in Table E. Table F projects the break even analysis in both units and dollars as a basis for further projections.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.