A. Executive Summary: Neptune Gourmet Seafood is facing a problem with their business operations and overall strategy. They are known for being the most upmarket player in the seafood industry and are able to sell their products at commanding premiums. However, they are currently facing a problem with inventory. New regulations and an infusion of new technology has caused their finished goods inventory to triple what it was just a year ago. Multiple potential solutions have been proposed to Neptune’s CEO, Stanley Renser. Strategies varied from cutting prices to creating a private label to geographical expansion. Neptune should expand into China, where they will be able to reach high demand while continuing to maintain their brand equity.
B.
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Financial Investment (short-term) – will the alternative require a large initial investment?
2. Financial Impact (long-term) – will the alternative produce favorable long-term returns?
3. Customer Perception of Brand – will the alternative affect the company’s brand equity?
4. Risks Incurred – will the alternatives have a high probability of success?
5. Competitor Response – will the alternatives entice a response from their competitors?
6. ASPD Response – will ASPD take away their gold seal of approval?
7. Inventory levels – will inventory shrink to normal levels?
F. Alternatives: The infusion of new efficient technology combined with increased regulation leads Neptune to produce more seafood than demanded. Rising variable costs of inventory holding costs and fueling costs has diminished their margins and in turn profitability. Neptune must make a decision that not only will alleviate their growing inventory, but will also advance the company going forward.
Option A – Launch a new mass-market product “Neptune Silver” and cut prices by 50%
Pros:
• Generates a potential $33.715 million in revenue on excess inventory, which otherwise would perish, eliminating the sunk
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Recommendations:
Short Term – Tactical: According to the alternatives evaluation matrix, Option C is the optimal recommendation based on the evaluation criteria. This solution will take time to implement, indicating Neptune should center their attention on the strategic decision to
By lowering selling prices across the board, Opossumtown, Inc. reduced its inventory turnover ratio, cutting the number of days to sell inventory from 174 days to 104 days; that is a 40% improvement. Opossumtown, Inc. also cut the number of days it takes to collect its credit accounts from 68 to 44 days, again that is 35% better than the previous year. The company is able to do this while cutting its debt ratio by 10% and increasing its current ratio by 25%, making it appear more favorable in terms of liquidity. As promising as this may look, this is not the whole picture. Opossumtown, Inc. shows an 11% decline in gross profit as well as operating income ratios, and a 3% decrease on the profit margin ratio. The decline of these ratios is a result of the company’s new strategy of decreasing the selling price and increasing its marketing and selling expenses. Opossumtown, Inc. made some noteworthy advancements with the implementation of its new plan for 2014. However, based on the assessment of the balance sheet, income statement and the ratios, the corporation did not achieve its goal to increase operating income by 6% and net income by 4%. Opossumtown, Inc. was only able to grow its operating income by a little more than half of one percent and net income by
However, the Boiling Crab has already penetrated the market in California with the proper level of price. The restaurant business cannot charge the price far more different than the others because in the same level of restaurant, the clients will focus on the range of price before choosing it. Moreover, the Boiling Crab is the seafood, so the market price of seafood, such as shrimp, lobster, crab is very fluctuate depended on how difficult to find each item at that time. As you can see from the Boiling Crab menu, these items will be charged according to the market price at that time. Referring to the appendix 1, I compare price of food from many restaurants with the same kind of food, but it turns out that the level of price is pretty much the same between the Boiling Crab and the Kickin’crab.
Our mission is to provide our customers with the best products and services that we have created a new market space for. We strive for 100% customer satisfaction and taking what used to be multiple purchases of software into one operation system. That can increase many aspects of the important sectors within the restaurant industry. I.e. decrease employee-training time, increase outputs, real-time record keeping ‘including inventory’, and more.
In 1996, Jim Wagner was hired as chief financial officer and was able to successfully achieve steady profitability for the company. One year later, in 1997, in an attempt to source its strategic investments, Natureview organized an equity infusion from a venture capital firm; however, the venture capital now needs to cash out of its investment in Natureview and management will therefore need to find another investor or position itself for acquisition. In order to attain the maximum potential valuation, the company must make strategic marketing choices in an attempt to increase revenues to $20 million before the end of year 2001. And to meet this lofty goal, Natureview can potentially enter a new market and transition from the natural food channel into the supermarket channel, a move that would signify a dramatic departure from the company’s present cha...
So this is where option 1 comes in. If there is an opportunity for Andrews to reduce costs, increase production to meet increased demand, then that should be quickly taken advantage of. It’s that simple.
PepsiCo can potentially acquire California Pizza Kitchen and integrate it in the company’s decentralized management approach. Since PepsiCo executives have experience in the quick service food industry, it should not be a reach for the company to successfully run this casual dining restaurant. For this venture to be successful, it is imperative that management cut down the operating costs at California Pizza Kitchen through the PepsiCo Food Systems distribution network and improve on the 3.1% operating margin that California Pizza Kitchen is currently operating at.
5. The chemicals department must become more profitable. Until this can happen, the 2 other departments (electronics, plastics) should acquire their materials from a source that is the lowest cost to the company. If the above recommendations fail to improve the profitability of the chemicals division, it should consider changing management or even selling off this division.
To fish or not to fish is a personal choice. The fact that the oceans are being overfished is a growing concern for individuals, organizations, and governments throughout the world. In this paper I want to discuss the effects of overfishing on the restaurant industry, and possible solutions to solve the problem. Fishing is an ongoing source of food for people around the world. In many countries it is a food staple in their everyday diet. In more modern societies eating fish has become a sensual experience, and not just for the wealthy. It hasn't been until population explosions in the last century that the demand for seafood has led to more effective fishing techniques and technologies. Now the demand for popular fish like the salmon, tuna, sea bass, cod and hoki, which is the key fish in McDonalds filet o' fish, is diving wild populations to dangerously low levels. The methods used to catch the amount of fish demanded by the industry do not leave sustainable populations in the wild. In an attempt to preserve the fish population, governments have set limits on the minimum size that may be harvested and how many of each may be taken. Boundaries have been set up saying which areas can be fished and which ones should be left alone. A number of smaller fisheries have gone out of business because of the limits imposed by the government. This leads to even less fish being harvested and brought to market. Therefore the amount and varieties of fish at markets are smaller and can cause shortages for wholesalers and restaurants. Some restaurants will no longer have the variety on their menus that they used to enjoy. If a restaurant thrives on its seafood menu they may be unable to cope with the shortages and will go out of business. In the ...
Key success factors in this industry include on time delivery, quality product, and brand recognition. Supermarkets and restaurants cannot afford to have shelves sit empty for even a moment. For a company in this industry to succeed it must have a model that allows for on time delivery. This must combated by the cost of keeping inventory levels to high, and the risk of wasting inventory that is no longer fresh enough to be sold. Forecasting product demand is critical for any company in this industry to have enough inventories to supply, without creating profit eating w...
Lululemon’s has to produce and sell 150,000 jackets in order to cover their total expenses, fixed and variable. At this level of sales, Lululemon’s will breakeven (profit = loss).
At the age of seventeen, Fred Deluca decided to open a submarine sandwich shop as a way to help pay for his education of becoming a medical doctor. Dr. Peter Buck offered Fred a $1,000 loan and became his partner and 1965 the first Subway store was opened in Bridgeport, Connecticut. They learned through experience how to run a business, with the integrity of serving a high quality product, and providing excellent customer service. Today, Subway is the world's largest sandwich chain with more than 41,000 locations around the globe. The goal is to serve the highest quality foods, and make sure everything produced meets the safety standards from the time it is grown, to when it is put into a sandwich. To insure this, sustainable agricultural practices such as cover cropping, and crop rotation this restores nutrients and minimizes pesticide and fertilizer use. With thousands of restaurants throughout the world, subways supply chain needs to be sustainable and efficient in order to cut costs. Many vendors and suppliers worked with Subway to add or move locations closer to our distributors, and we have implemented many re-distribution centers which help reduce emissions, and provide lower shipping costs. Subway has a Distribution Operational Efficiency program that’s purpose it so find ways to ensure all traveling routes and techniques are optimized, and all the trucks are shipped with full loads to reduce mileage, and be as efficient as possible. Recently, Subway has introduced a process in the United States that consolidates all orders of equipment into a single shipment for new restaurants, and restaurants being remodeled. This helps eliminate excess packaging, and unnecessary non-value added activity at the building site. Subway...
We know that it was going to be expensive to produce the product but we are confident that no matter the cost of production, our sales would greatly succeed the cost. The cost of producing a 5 oz. can was about 75 to 80 cents if they can produce 100,000 per month. If we were to produce 50,000 cans per month, that cost would rise by 5 to 10 cents per can. A 10 oz. can would cost about 25% more than a 5 oz. can would to produce. With those numbers, 100,000 5 oz. cans would cost us about $900,000-$960,000 per year to produce. 50,000 5 oz. cans would cost us $750,000. 100,000 10 oz. cans would cost us $1.125M-$1.2M a year...
As you can see, Sea Goddess needs to undergo some major changes. These changes could help lead to a more positive business image. The strategies that have been rejected in this report will help lead SGC to increased profits and customer awareness.
Finally, I have suggested some recommendations for the issues that I have mentioned above. In reference to the first issue, it will be profitable for the company to change to level monthly production.
As a consultant for Toys, Inc., I have been called in for my advice by the company’s president, Marybeth Corbella; on which of the two proposed options would be best for the company and for the customers as well. Toys, Inc. is a 20-year-old company that produces toys and board games, our company has a reputation built on quality and innovation. Although we have been the market leader in our field, the sales have become stagnant in recent years, and sales have begun to decline when comparing them to the sales in the past. With the company’s managers attributing the decline of sales on the economy, the company was forced to reduce production costs and layoffs in the design and product development departments; this action will hopefully increase