Competitive Analysis for a New Concept Bread Brand in Lyon

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Competitive analysis

* Market analysis

Market overview
In 2011 the market of baked goods was evaluated in $1.8 billion. * As a result of the increase in cereal prices the total sales of baked goods rose only 1% in value. * Packaged industrial bread was the only subsector to increase during this period.

Unpackaged/artisanal products still dominate this sector. After losing significative ground to hyper/supermarkets, three years ago, traditional bakeries reacted by capitalizing on their image of quality and authenticity, with premium ingredients. Auchan and Carrefour increased their in-store bakery offers and promoted their products through advertising campaigns focusing in traditional values.

CompetitionInsee, Démographie des enterprises -2010-

The market, without counting retail stores, is divided in:
* Boulangers(licensed bakers that make the bread from the beginning until the end), * And Terminaux de cuisson( buy the formed dough and just cook it, or buy the bread how it is, they are not licensed bakers).

The competitive landscape is extremely fragmented with the top 5 manufacturers having only 8% of market share.

Competitor Analysis

| Boulangeries| Retail Stores|
Product Profile| Big| Medium/Big|
Price| 0.90€ Baguette| 0.75€ Baguette|
Strengths| Product and service quality| Price|
Weaknesses| Price| Service quality|
Strategies | Differentiation by quality. Product made on the spot.| Differentiation by price.Product not entirely made on the spot.|

Blue Ocean

MARKETING MIX
* Product

Brand

We chose for brand name the name “Boulangerie Chez Vous” which means “Bakery at your house”; we believe that it is an easy recognizable name. We designed this logo trying to make it easily imply the company’s trade and objectives.

How it works

* This system works by monthly orders. The orders are delivered every day (Except Sundays). * It’s a service devised for condos of 20 people or more. * The orders are chosen/altered through the website or through phone and can even be canceled for some periods of time, in case of vacations for example. * The clients have until 24h before the delivery to alter their requests. * Although the requests are fully customizable, for the sake of easiness and accounting, it is offered standardized daily packs. * Half is paid on the beginning of the month the rest paid at the end. If the orders didn’t fulfill the expected amount, or even half, the extra money will be discounted on the next month. The user as total access to his account and his balance sheet, either by phone or internet. * The bread is then delivered between 4:00 am and 7:00 am.

Product Packs

We decided to offer three base packs, which are at any time customizable; (Meaning, the user will have the ability to add different products or quantities at any time): s

* Price

The price is our weakest link, for it will need to be higher than the competition in order for us to maintain a good margin.

According to a study by - BoulangrieNet © 2011 –

The average cost of a baguette divides in:

19% - Materials
53% - Wages
11%- Packaging
6% - Revenue

Which means that if the average price of a baguette is 0.90€ then the revenue will be 0.06 € which is not enough to sustain the service.

There are two possibilities;
1. Increase price on all the products.
2. Impose a service cost of 0.50 cents for each delivery.

We chose option 2, because:
* If the consumer wants big quantities of bread the cost would still be similar as if it was bought in a bakery, * Also, in the mind of the consumer the price would be the same as the one in his usual bakery, * And it would permit promotions like “if 3/4 of the building use the service, the delivery will be free.”

The point against this choice is that our margin would not alter, but we believe that the amount of clients this option can...
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