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NESTLE REFRIGERATED FOODS
PROBLEM
Whether to launch the new refrigerated pizza in response to the expected reduction in growth of Nestles share of the refrigerated pasta market.
OBJECTIVES
§ Sustain rapid growth of Nestle.
§ Secure a foothold in the refrigerated foods category (possible 1st mover advantage). ... Launch refrigerated pizza:
§ Pizza kit with topping
§ Pizza kit only
(Pre-assembled pizza is not considered due to its production infeasibility and poor quality)
2. ...
CRITERIA
§ Distribution
§ Competition
§ Quality
§ Company growth
§ Market size and achievable market share
§ Time
§ Consumer preference
§ The component approach
§ Market research results
NESTLE PRODUCT ANALYSIS (PIZZA KIT)
STRENGTHS
§ Unique product (first refrigerated in the market). ...
§ Effective distribution channels using brokers experienced in perishable/refrigerated foods. ...
§ Perishable nature of the product
OPPORTUNITIES
§ Ability to be the first player in the refrigerated pizza category.
§ Favorable acceptance rates for refrigerated foods in the large US market. ...
THREATS
§ Kraft expected to launch refrigerated pizza in about six months. ... COMPETITION
Competition in the refrigerated foods category is increasing as new players enter the market. As a result companies have realized that the best way to maintain a sizable portion of the market is to come up with new innovative products to create new niches within the refrigerated foods segment. Kraft is expected to launch its refrigerated pizza within the next six months. ... In line with the company’s growth objective, Contadina has to beat Kraft to the refrigerated pizza niche. ... DISTRIBUTION
Although there is a potential distribution problem in the US due to it’s disperse geography, and the perishable nature of refrigerated foods, Nestle can overcome these constraints by first- Achieving an optimized weight-to-volume allocation on freight trucks via cross docking of products which can reduce distribution costs, and maintaining its use of the experienced broker organization as sales agents, this will help develop a specialization within the refrigerated foods category. ... This will provide a larger window of time for the distribution of the refrigerated products. ... Also Nestle will gain additional revenue from the sale of toppings.
DECISION
Considering the various issues discussed, I feel Nestle needs to launch its new “pizza kit with topping” as soon as possible, before Kraft comes into the market.
Approximate Word count = 1746
Approximate Pages = 7
(250 words per page double spaced)
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