Reliance Baking Soda Case Analysis

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Brief Case: Reliance Baking Soda Situation Analysis: Reliance Baking Soda is an established mature product that is common in households. The product is sold through several types of retailers and is often sold through promotions at both the consumer and trade level. As the year 2008 quickly approaches the domestic brand director is tasked to increase profits by 10% before SGA, overhead, and taxes in order to fund the launch of two new high priority products by 2008. Problem Definition: Baking soda is a boring product that has low turnover. Furthermore the brand has the current advertising campaign emphasizing on different ways to use baking soda can be assumed to not be very effective since advertising recollection is low. Option 1: Cut down on trade promotions lowering the amount of baking soda in stores and increasing the price per unit. Pros: Getting rid of some trade promotions such as free cases with purchases over a certain amount will help reduce overhead. Fewer products in the market would also hopefully increase demand. Cons: Retails could by less baking soda and could probably decide to sell baking soda at a higher price, which could deter some existing costumers from buying again. Option 2: Since a 40% of consumers use coupons when purchasing baking soda the brand director could attempt to increase consumer promotions. Pros: There has been some success in the past to this method and there is also an emerging trend of coupon clippers as mentioned in the case. Cons: This would lower the amount of revenue per unit sold and although consumer like to use coupons when purchasing baking soda, a heavy user of the product only purchases 5 times a year. Option 3: Increase the turnover rate of baking soda by introducing freshness indicator in the small 8oz packages of baking soda. Pros: By indicating when the small packages has expired in

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