BUS 599: Strategic Management

COMPANY DESCRIPTION 7

Company Description and SWOT Analysis

Student’s Name

Institution Affiliation

Company Description and SWOT Analysis

NAB Company Name

The name of the start-up non-alcoholic beverage corporation will be MelieCate Beverage Corporation (MCBC). MelieCate is derived from Melinda Cates, which is the name of the founder and owner of the business. In choosing a brand name for the start-up entity, the principles of memorability and simplicity were considered. MelieCate stands out because of its ability to be remembered. Thus, the thoughtful and inventive blend of words was to make the name stir curiosity and attract interest as well as attention to the company’s intended target market. The name is also simple, and it will not be difficult for the target market to pronounce

Revised Mission Statement

Quality is an important asset for MelieCate Beverage Corporation (MCBC). By using the right ingredients, the company aims to provide the best quality Acai Berry Juice to its customers. Quality is the core component of the mission statement. The rationale for emphasizing on it is to communicate the core goals of the company and using the proper ingredients to achieve this aim.

Trends in non-alcoholic beverage industry

The non- alcoholic beverage industry is mainly made up of companies that produce a broad range of drinks including but not limited to sports drinks, bottled water, carbonated drinks, coffee, fruit juices as well as ready to drink coffee and tea. According to Bailey (2016), consumption of non-alcoholic beverage in 2014 rose by 2.2% compared to a 0.1% drop registered in 2013. The growth was attributed to an increase in consumption of carbonated drinks; mostly sodas.

There has also been a rising preference for healthy juices from vegetables as well as whole fruit as health awareness rises among the American citizens. Apart from health considerations, the growing market in the fruit industry is also due to pricing strategies employed by beverage companies and their packaging. Currently, orange juices hold major demand in the industry compared to other fruits (Transparency Market research. 2016).

However, products that have significant health benefits are also gaining popularity in the market. Acai berry juice as the company’s primary product is also gaining popularity in the market (Transparency Market Research, 2016). The juice is particularly in demand due to its ant detoxing property. Thus, introducing the product at a time when it is gaining popularity by the health conscious customer is likely to boost sales for a start-up corporation.

Strategic Position

MelieCate Beverage Corporation intends to be a leader in the juice industry. To achieve that objective, the company believes that a differentiation strategy is indeed the best position strategy for the start-up entity. The approach that will be used to implement this strategic position is marketing. The company intends to market the acai juice as a product that is entirely different from other fruit juice in the market. Thus, what will make the company’s product distinct from others are its health capabilities, flavour and its price.

Distribution Channels

The main distribution channel for MCBC Acai Fruit Juice will be through retailers. The rationale for this strategy is that fruit juice sales by way of retail especially in supermarkets tend to be more valuable. The rationale for choosing retailers as the core distribution channel is that the consumer has a choice of interacting with the product up close thereby an efficient method of reaching out the consumer. Secondly, the method a consumer can get information about the product from helpful staff employed by the retail store. Retail distribution also ensures that the start-up entity embraces the competition in the market. Thus, the company hopes to be a memorable brand to consumers by pricing our product at an affordable price.

Risk Analysis

One major risk that faces the start-up business is that of finances. The company intends to start by using the funds collected from family and friends. However, failure to plan a working financial plan will the available capital may hinder the success of the entity. To mitigate this risk, the firm intends to seek funds from outside investors whether venture capitalists or angels. The other risk is that third parties may purchase the juice and attempt to resell it to the consumers. FDA discourages the sale of fruit juice to third parties. To prevent the risk, the company will manufacture the juice at a central position and only sell to authorized retailers whose names will appear on the company’s website.

SWOT Analysis

Strengths

Rare Product: Despite the number of companies in the juice industry, not so many of them engage in the production of acai berry fruit juice. MelieCate’s acai berry fruit juice will, therefore, be exceptional in the market. Due to its varied health benefits, the product will attract healthy conscious people.

Affordability: Consumers will be able to access the product due to its unique pricing strategy. The company intends to put the fruit juice price at a fairly low range so as to attract people from all walks of lives. By doing this, every category of individuals will be offered the opportunity of enjoying the product.

Quality: The company has already identified a source of quality acai berry from Central America. The company believes in quality right from sourcing of raw materials. The end product will be worth the price. In addition, the product will be safe for the consumer’s health.

Leadership: The management team in place is that of skilled individuals. Most of the members have previously worked in successful companies like PepsiCo, and they will be transferring skills learned earlier to the start-up business.

Weaknesses

Funding: The company will start by using funds raised by family and friends which may not be sufficient as starting a business of this nature is quite costly. A lot of money will be required to launch the running of the company. Therefore adequate planning is necessary otherwise the business may fail to start as planned.

The existence of a market: The fruit juice market has been in existence since time immemorial. Fruit juices in the market are really similar, and we hope that offering healthy acai berry fruit juice we will be able to direct the attention of the fruit juice consumer to our product.

Opportunities

Major gallons of non-alcoholic beverage consumed in America come from the soft drink category. However, Fang et al., (2009) indicates that such drinks are unhealthy and may cause various health problems to consumers. Such findings have resulted in the consumption of carbonated drinks to go down thereby creating an opportunity for health drinks in the nation. The company’s product is 100% fruit juice, and it, therefore, targets the class of consumers who are mindful of their health and are seeking to substitute the various unhealthy drinks in the market.

Threats

Weather Changes: Fruit juice consumption thrives during the hot climate. However, sales are likely to go down in winter as people tend to consume hot beverages. Therefore, the company will need to expand and offer beverages for the cold season after its first few years of operation.

Barriers to market entry: Since it is a start-up business, the first few years of operation will be rather difficult as the brand is not familiar to consumers. However, the company intends to create awareness through advertisements and brochures so as to reach most of the customer base.

References

Bailey, S. (2016). Non-alcoholic Beverages: How Have US Consumers' Tastes Changed? Retrieved from http://marketrealist.com/2016/03/insight-transition-us-nonalcoholic-beverage-choices/

Fung, T. T., Malik, V., Rexrode, K. M., Manson, J. E., Willett, W. C., & Hu, F. B. (2009). Sweetened beverage consumption and risk of coronary heart disease in women. The American journal of clinical nutrition, 89(4), 1037-1042.

Transparency Market Research. (2016). Juice Market - Global Industry Analysis, Size, Share, Growth, Trends and Forecast 2015 – 2021. Retrieved from http://www.transparencymarketresearch.com/juice-market.html