Mini Case on Marketing You are a high level manager for a food processor company
ID: 353551 • Letter: M
Question
Mini Case on Marketing You are a high level manager for a food processor company. The top management team recently decided that it is time to expand the company's product lin, With the available capacity and resources the company can expand just one cate decided to analyze the sales of your products in the past year. gory for now. To ensure the success of this expansion, your team As you review the performance of your products, you plan to make your decision based on any or all of the following criteria: .Number items in each category Total units sold in each category Amount of revenue received per category Average unit price per category From the company database, you retrieved the following transactions for the last four quarters for all of your products. See Exhibit 1 (or use the Excel file). Part I of the assignment Using the data to assess which product category would you recommend to expand? Justify your answer based on your analysis for cach proctucer caregory on ts total products, revenue received, and average units price for the caregory. List them in a table After you arrive at your decision, but before you make the announcement, you received a disturbing call from the warehouse suggesting that some part-time employees have incorrectly claimed a large portion of your potato chips as "damaged and subsequently taken those "damaged" product home. This would have lowered the sales of the Potato Chips because the warehouse had insufficient inventory to satisfy the order Apparently these part-time employees are under paid and under worked and they are just trying to relieve their hunger. The team made an estimate that since there are 10 part-time employees, 250 working days, and assuming 2 bags of chips per meal gives a total of 15,000 bags of potato chips Part II of the assignment changed with this quick analysis, does it change your decision? Explain in a paragraph does not happen again? If the company can sell the entire 15,000 bags of Potato Chips, would your recommendation be How would you address this situation for the employee and the company in the future so that itExplanation / Answer
Part I
The sales of various products in different product categories for the 4 quarters are shown in the table below:
Table:
Item Name
Category
Quarter 1
Quarter 2
Quarter 3
Quarter 4
Unit Price
Units Sold
Sales
Unit Price
Units Sold
Sales
Unit Price
Units Sold
Sales
Unit Price
Units Sold
Sales
Cereal
Breakfast
1
6100
6100
1.09
4200
4578
0.93
3550
3301.5
0.58
3400
1972
Corn Flakes
Breakfast
1.25
3920
4900
0
0
0
1.01
3900
3939
0.99
2290
2267.10
Fruit Cereal
Breakfast
2.5
690
1725
1.47
670
984.90
1.19
920
1094.80
1.42
1170
1661.40
Total
5900.50
Cholocate Chip Cookie
Snacks
3
7510
22530
3.91
4000
15640.00
5.4
3520
19008.00
0
0
0.00
Oatmeal Cookie
Snacks
2.25
540
1215
0
0
0
3.41
570
1943.7
5.06
400
2024
Corn Chips
Snacks
0
0
0
1.84
11060
20350.4
0
0
0
2.96
10260
30369.6
Potato Chips
Snacks
0
0
0
2.84
530
1505.2
0
0
0
0
0
0
Multi Grain Cookie
Snacks
0
0
0
0
0
0
2
11260
22520
0
0
0
Total
32393.60
Corn Oil
Oil
3
1440
4320
2.75
710
1952.5
0
0
0
2.58
670
1728.6
Olive Oil
Oil
6
360
2160
4.29
340
1458.6
3.17
280
887.6
0
0
0
Sunflower Oil
Oil
4.5
1310
5895
0
0
0
4.26
970
4132.2
5.95
530
3153.5
Canola Oil
Oil
0
0
0
0
0
0
2.33
1040
2423.2
1.78
360
640.8
Total
5522.9
Potato Flour
Baking
2.25
7770
17482.5
1.18
6270
7398.6
0
0
0
0.62
4710
2920.2
Wheat Flour
Baking
2
6060
12120
2.19
4900
10731
1.94
3750
7275
0
0
0
White Flour
Baking
0
0
0
1.73
7920
13701.6
2.52
11230
28299.6
3.34
12900
43086
Cake Flour
Baking
0
0
0
0
0
0
0
0
0
1.74
4320
7516.8
Total
53523
I would recommend expansion of ‘Baking’ product category as it earns the highest sales revenue for the company in the 4 quarters, i.e., 53,523.
Part II
The total sales value of 15,000 bags of potato chips = 42,600 (assuming a unit price of 2.84).
Then total sales revenue for the company in ‘Snacks’ category = 32,393.6 + 42,600 = 74,993.6
Now as per the new data, I would recommend the company to expand in ‘Snacks’ category as this category brings the highest sales revenue.
I would have proper checks and balances in place and ensure that there are frequent inventory checks of all the products in all the product categories. Moreover, there should be CC TV Cameras placed in different places in the warehouse for strict monitoring.
Item Name
Category
Quarter 1
Quarter 2
Quarter 3
Quarter 4
Unit Price
Units Sold
Sales
Unit Price
Units Sold
Sales
Unit Price
Units Sold
Sales
Unit Price
Units Sold
Sales
Cereal
Breakfast
1
6100
6100
1.09
4200
4578
0.93
3550
3301.5
0.58
3400
1972
Corn Flakes
Breakfast
1.25
3920
4900
0
0
0
1.01
3900
3939
0.99
2290
2267.10
Fruit Cereal
Breakfast
2.5
690
1725
1.47
670
984.90
1.19
920
1094.80
1.42
1170
1661.40
Total
5900.50
Cholocate Chip Cookie
Snacks
3
7510
22530
3.91
4000
15640.00
5.4
3520
19008.00
0
0
0.00
Oatmeal Cookie
Snacks
2.25
540
1215
0
0
0
3.41
570
1943.7
5.06
400
2024
Corn Chips
Snacks
0
0
0
1.84
11060
20350.4
0
0
0
2.96
10260
30369.6
Potato Chips
Snacks
0
0
0
2.84
530
1505.2
0
0
0
0
0
0
Multi Grain Cookie
Snacks
0
0
0
0
0
0
2
11260
22520
0
0
0
Total
32393.60
Corn Oil
Oil
3
1440
4320
2.75
710
1952.5
0
0
0
2.58
670
1728.6
Olive Oil
Oil
6
360
2160
4.29
340
1458.6
3.17
280
887.6
0
0
0
Sunflower Oil
Oil
4.5
1310
5895
0
0
0
4.26
970
4132.2
5.95
530
3153.5
Canola Oil
Oil
0
0
0
0
0
0
2.33
1040
2423.2
1.78
360
640.8
Total
5522.9
Potato Flour
Baking
2.25
7770
17482.5
1.18
6270
7398.6
0
0
0
0.62
4710
2920.2
Wheat Flour
Baking
2
6060
12120
2.19
4900
10731
1.94
3750
7275
0
0
0
White Flour
Baking
0
0
0
1.73
7920
13701.6
2.52
11230
28299.6
3.34
12900
43086
Cake Flour
Baking
0
0
0
0
0
0
0
0
0
1.74
4320
7516.8
Total
53523