Natureview Farm

Case Analysis 4: Natureview farm

Summary: Natureview farm is considering expanding into the supermarket channel, to increase its revenues from 13M $/year to 20M $/year and attain the highest possible valuation in case of acquisition or to become appealing to investors. When marketing, Natureview should opt for option 2, that is expanding into the supermarket chain through four SKUs of the 32-oz. size, generating a potential additional profit of around 9.7 M, without severing relations with current collaborators and customers.

Company: Natureview is a manufacturer of refrigerated cup yogurt. It is known for the high quality of its products, long shelf life and use of natural ingredients. It is currently succeeding through a strong brand name, low cost guerilla marketing, and strong presence in natural foods channel on a national scale.

The collaborators include the retailers, the distributors and the brokers. The below table summarizes the retail price and manufacturer sales price for each distribution channel, accounting for the margins of each collaborator.

  | Supermarkets | Natural Foods Channel |

  | 8oz | 32oz | Multipack | 8oz | 32oz | Multipack |

Retail Price | $ 0.74 | $ 2.70 | $ 2.85 | $ 0.88 | $ 3.20 | $ 3.35 |

Manufacturer Sales price | $ 0.46 | $ 1.68 | $ 1.77 | $ 0.48 | $ 1.76 | $ 1.84 |

Competition: Primary: Natural or organic yogurt producers, such as Brown Cow and Horizon organic. While these companies currently compete in the natural food channel, they could as well start competing in the supermarket channel

Secondary: Big brands like Dannon and Yoplait controlling 50% of the market, and considering expanding their product line into organic products; These competitors have the advantage of longer relations with supermarkets, enough cash to spend on advertising and an established experience in the supermarket channel....