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Lecture 9

BU481 Lecture Notes - Lecture 9: Ganong Bros., Pest Analysis, Private Label


Department
Business
Course Code
BU481
Professor
Karin Schnarr
Lecture
9

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Saturday, 24 June 2017
BU481 LECTURE NOTE WEEK 9
Case Preparation & Lecture Notes (Updated on 2017/06/29)!
Strategy Triangle Analysis: !
Goal: !
-David Ganong is forced to provide a recommendation plan to restore the
company to profitability, !
-and a growth plan that would increase company revenues by 50%. !
-Profits and growth should be raised from non-core businesses. !
-obtaining additional funds !
-change their business model to bring changes !
Product Market Focus:
-Ganong Bros. limited was a small, private family confectionery firm with a wide
variety of sugar confectionery and chocolate product lines. !
-also sell boxed chocolates in Atlantic Canada !
-Canada!
-retailers, outlets, wholesale distributors, retail stores !
-private label products !
Activities:!
-maintained its traditional regional markets through local allegiances and seasonal
products !
-30% market share for its Valentine’s Dat chocolates in heart-shaped boxes !
-used its own sales force and independent brokers to sell its chocolate across
Canada !
Core Value Proposition: !
-products were made with great professional care using only the finest ingredients:
quality !
-innovation: cinnamon-flavored, pink, hard candy jacket over a chocolate centre,
lollipops using butchers’ wooden skewers, first five-cent chocolate nut bar,
Valentine heart boxes!
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Saturday, 24 June 2017
-Quality !
-Traditions, chicken bones !
-innovative company !
-back to the community!
Strategy:!
-stuck in the middle: no clear strategy, neither low cost nor dierentiation !
PEST Analysis:
Political:!
Economic
-Sugar confectionery industry has nigher profits than the chocolate industry !
-four major multinational chocolate bar companies equal in size, co-existed in the
same market !
-demand for many domestic confectionery products had decreased recently !
-lower proportion of children in Canada !
-Increase in exports !
-consolidation in 1980 led to greater concentration of market shares !
-free trade: Canadian industry lost this tari dierential !
-protected behind a tari wall, 7.5% - 15% tari line !
-by 1994, $400 million of manufactured products were exported out side of
Canada, and $540 million worth of confectionery products were imported into
Canada !
-Foreign ownership of the industry was high, multinationals had a major position in
the industry !
Social:!
-a growing number of health conscious Canadians !
-in the late 1980s, consumer trend changed to purchasing high-quality, specialty
products at premium prices. !
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