Gold Medal Crumpettes

Table of Contents

Table of Contents………………………………………………………………………………………………………………. P.1
Project Summary………………………………………………………………………………………………………………… P.2
Problems..………………………………………………………………………………………………………………………….. P.2
Assumptions..…………………………………………………………………………………………………………………….. P.2
Decision Criteria…....………………………………………………………………………………………………………….. P.2
S.W.O.T. Analysis….……....…………………………………………………………………………………………………. P.3
Alternative Analysis…………..………………………………………………………………………………………………. P.4
Recommendations…………………………………………………………………………………………………………….. P.5
Marketing Strategy……………………………………………………………………………………………………………. P.5
Financial Assumptions………………………………………………………………………………………………………….P.7
Profitability Analysis Option 1: Maintain Existing Coverage………………………………………………..P.8
Profitability Analysis Option 2: Phased Expansion..…………………………………………………………… P.9
Profitability Analysis Option 3: Rapid Expansion…………………………………………………………….…. P.10
Profitability Analysis License Product…..………………………………………………………………………….… P.11

Project Summary
Lucas Foods is a food manufacturing and wholesaling business specializing in frozen egg products, shortening, flour, baking mixes, spices and bulk ingredients. The company is owned by Jerry Lucas, who purchased the company from a major brewery in 1979. Their primary customers are the five major national food wholesalers with their secondary customers being smaller regional wholesalers and independent grocery stores. The company followed a portfolio approach, regularly adding and removing products with marketing cycle in mind. Lucas Foods generated a current annual sales level of $12 million and has been a recent entrant into the bakery products market. Their specialty product is Gold Medal Crumpettes which is targeted as a high priced and high quality biscuit.

Problem
Since Lucas Foods is a new entrant in the bakery products market, and having such a high quality product, they are having issues determining the best marketing strategy to achieve maximum