Strategic Management: An Integrated Approach

Topics: Chocolate, Types of chocolate, Candy Pages: 24 (11854 words) Published: April 12, 2015
2015/3/19

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Chapter 1: The Cherry Lady Chapter Contents
Book Title: Strategic Management An Integrated Approach
Printed By: ALICIA LI (aliciali0626@gmail.com)
© 2015, 2013 Cengage Learning, Cengage Learning

Cae 1
The Cherr Lad
Chapter Introduction
1-1 The Chocolate Industry
1-1a Market Size
1-1b Inputs and Traits of Chocolate Products
1-1c Competition
1-1d Demand
1-1e The Premium Chocolate Segment
1-2 Alicia’s Background
1-2a The Origin of Tart Cherry Caramels
1-3 The Cherry Lady
1-3a Product Line
1-3b Markets
1-3c Production
1-3d TCL’s Financial Resourcesand Performance
1-4 Growth Opportunities
Chapter 1: The Cherry Lady Chapter Introduction
Book Title: Strategic Management An Integrated Approach
Printed By: ALICIA LI (aliciali0626@gmail.com)
© 2015, 2013 Cengage Learning, Cengage Learning

Chapter Introduction
Alicia Gans, The Cherry Lady
J. Michael Geringer, California Polytechnic State University In early July 2007, Alicia Gans leaned back against the food mixer in her hot, cramped, rented kitchen after putting another batch of Tart Cherry Caramel chocolates onto racks to cool. As she wiped the perspiration from her brow, she contemplated the challenges that confronted her and her young company. Alicia had founded The Cherry Lady (TCL) in October 2004 to comercially produce her distinctive chocolates. Within three Christmas seasons, TCL’s sales had increased tenfold and the customer base had grown to nearly 100. Earlier in the day, Alicia received a voicemail message from a major mail order catalog http://ng.cengage.com/static/nbreader/ui/apps/nbreader/print_preview/print_preview.html

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2015/3/19

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company, Epicurean Selections, indicating that TCL had received approval to become a preferred vendor. Now Alicia had three weeks to accept their offer, two months until the first trial shipment would be sent, and three months before the peak Christmas season would begin. While this approval was certainly exciting, it intensified the issue of what direction the business should follow. During the past two years, TCL had been a cottage operation, specializing in producing premium quality, hand-made chocolate confections. Alicia had recently explored new market opportunities, and several looked promising for the coming year, but having Epicurean Selections as a customer would drastically alter the scale of her business. Until now, TCL’s largest customer had ordered in increments of 100 pounds and orders required a week to process. Epicurean Selections would receive chocolate orders shipped in 5,000 to 10,000-pound lots. The product would be shipped on pallets and transported by a large freight carrier. Since this new catalog customer would initiate a major growth phase for The Cherry Lady, Alicia asked herself, “What kind of company should The Cherry Lady become, and will I be able to successfully build and manage this new business?”

Chapter 1: The Cherry Lady: 1-1 The Chocolate Industry
Book Title: Strategic Management An Integrated Approach
Printed By: ALICIA LI (aliciali0626@gmail.com)
© 2015, 2013 Cengage Learning, Cengage Learning

1-1 The Chocolate Indutr
1-1a Market Size
Valued at
billion in 2006, more chocolate was consumed worldwide than any other manufactured food product. The U.S. was the world’s top producer of chocolate, with 3.5 billion pounds in 2006, and the production of chocolate and confectionery products was linked directly to approximately 65,000 jobs in the U.S.

At the retail level, the chocolate
market, with
billion in 2006 sales, was the largest segment of the
billion U.S. market
for retail confectionery. The latter also included sugar candy, licorice, gum, and a variety of other non-chocolate “sweets.” Sales of chocolate and chocolate-type confectionery in the U.S. had increased by

between 1996 and 2006. An additional growth of
was
projected by 2012.
Chapter 1: The Cherry Lady: 1-1b Inputs and Traits of...
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