The Tootsie Roll Industries Incorporated began in Chicago 117 years ago. The founder of the business was a gentleman named Leo Hirschfield. He began making and selling the Tootsie Roll. Today the famous product is still being made according to the original recipe and formula. However, since its inception, the business has become incorporated.
The primary production and consumption areas include the United States, Canada, and Mexico. However, the company sells its products in over 75 countries. While the Tootsie Roll is the oldest and perhaps the most well-known product, Tootsie has a fairly wide product range. Other products include Junior Mints, Charleston Chew, Dubble Bubble, and Dots to name a few (Goldberg, McDonell, Santhakumar, Wood, & Marquardt, 2010).
The purpose of this business proposal is to obtain a $17 million dollar loan to support a global marketing campaign for Tootsie Roll to stimulate growth and capture market share. This proposal provides an attached worksheet containing an income statement, cash flow statement, and balance sheet. Additional information available is industry analysis and trends, strategic plan, risk assessments, technology plan, marketing plan, SWOT analysis, competition, management, and community plans.
Industry Analysis and Trends
Tootsie Roll Industries Inc. is in the confectionary industry. In the U.S. alone the industry averaged nearly 15 billion dollars in sales. Experts predict that the industry will increase to over 17 billion by 2015 (Goldberg et al., 2010). Tootsie Roll claims approximately three percent of this market share. The confectionary industry has been very slowly increasing. However, the growth is consistent and quite predictable.
Certain trends have been arising in the industry. Tootsie should be aware of, and adapt to the trends. Imported chocolate is more available and cheaper, and the demand overseas is slowly increasing. However, the price of sugar has been increasing in the recent years as well. Important trends in the industry include a demand for chocolate with health benefits. The demand for premium chocolate options is increasing. However, with an unconfident economy, people want to spend less money on non-necessary things such as candy.
Tootsie Roll Strategic Position and Risk Assessment
“The company has grown to become an exclusive candy company building on its brand name in its niche market of hard candy. Tootsie Roll accounts for approximately 3% market share in a candy market that has slow, predictable growth with U.S. industry sales rising 3.9% in 2009. Strong consumer awareness of its brand name, line extensions, holiday offering, and periodic acquisitions allow Tootsie Roll to stay well-positioned and grow off its existing infrastructure” (Goldberg, McDonnel, Santhakumar, Wood, & Marquadt, p. 2, 2013).
Risk Assessment and SWOT Analysis of Tootsie Roll
A SWOT Analysis shows the strengths of Tootsie roll as a strong reputable brand of candy, strong balance sheet, strong stable supply and demand of ingredients, and paid dividends over the past 65 years. Its weaknesses are a strong dependence on domestic sales, not investing cash back into the company, and a failure to disclose succession planning. Opportunities include and international expansion, new innovative products, and the use of organic chocolate. Threats consist of an increase in commodity prices, competition, and oral health care.
Tootsie Roll operations include legal requirements of their employees and contracts. They deal with established vendors, suppliers, and they comply with all applicable laws regarding employment practices.
Technology trends domestic or international markets should be the same. The technology for making the Tootsie Rolls is domestically developed and applying these...