United Cereal Lora Brill Euro challenge

INTERNATIONAL BUSINESS CASE STUDY ON UNITED CEREAL LORA BRILL EURO CHALLENGE

Submitted by: Grishma Kothari PGDM- FINANCE Roll no 18

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United Cereal Lora Brill Euro challenge

1. The historical strategy approach of UC are as follows: a. Believed in 3 watchwords i.e. commitment, loyalty and diligence. b. Listening to customers through consumer research and focus groups. c. Emphasis on Spot the trend, make the market meaning high value placed on extensive market testing prior to launching a new product. d. Honouring the past while embracing the future meaning rejecting the wisdom that processed food have fixed life cycle. e. The company had a reputation of being an innovator. During their 100 years, their R&D had secured more product and process patent than their competitors. f. The company had pioneered the brand management system by giving their brand managers responsibilities like manufacturing, marketing and other functions. g. Each brand was treated as profit center and was constantly measured against other brands. h. The involvement of top management was very high for example to change the advertising or label, at least 12 signatures were required. i. The company takes few risks because failure of a product costs them millions even in small markets.

6. UC is centralised because at the beginning the case mentions that to make even a minute alteration like changing the label, at least 12 signatures were required before the approval. This indicates that decision making authorities vested only to the top level executives. Also to reach out to its European markets, the companys top executives had appointed country managers representing each country and they were given the power of deciding the product and promotion mix while keeping in mind to work according to the UC way.

United Cereal Lora Brill Euro challenge

9. The benefits of standardization are as follows: a. Low cost as all the products will be standard. b. Quality will be maintained throughout. c. Reduction in variety which may ease certain ambiguity. d. Reduces the promotion and marketing cost. e. less barriers during the process. 4. Following are the entry barriers for any business: a. No scope for expansion: - meaning a business cannot expand up to a certain level it will reach a point of stagnation. b. More sellers in the market and less number of buyers for your product. c. No demand for your products. d. Expensive to produce because of exorbitant cost of input. e. Market may already be saturated. f. Government restrictions on producing certain products. 5. The pros of launching a new product are as follows: a. Creates revenue for the business as a new product is being offered to the consumer. b. Bringing a new product in the market means after an extensive research the company might have found out a ready market for such products. c. Giving consumers the opportunity of trying something new. Following are the cons: a. The product may not be what the consumer desired. b. Lot of capital is invested in research and development and the result may or may not be favourable.
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United Cereal Lora Brill Euro challenge

3. UC industry included more than 30 companies with combined annual revenue of 12 billion. The industry organised two categories of cereal that is hot and ready to eat. It is very highly competitive industry more than 10% of revenues was spent on advertising and marketing. Profitability also depended on operating efficiency, managing materials cost and maximising retail shelf space. Large companies had significant advantage in purchasing, distribution and marketing. These were the few challenges for the company. 10. The euro brand team is developed for each brand and it consists of people who know about the development of product as well as able to do research and development. This team consist of brand manager from each country subsidiary that sold the product including people from manufacturing, logistics, representative of regional divisions VP. 8. The market dynamics are positive towards this product healthy berry crunch. The actual number of units is more than what they have targeted. Same thing happens with the market share they have targeted 0.6% market share but actually they have market share of 1.5% As well as the people who are ready to repurchase this product is also large in number. This can become euro brand also because the awareness of brand is showing positive sign. 2. Yes, the product healthy berry crunch can become first euro brand. Euro brand concept refers to coordinated European approach that used in product development as well as for product marketing. Before taking decision of introducing product in the market, they have done research work and market testing as it was culture of UC .First they identified the opportunity in the France market and whether they will accept our product or not to identify this they appointed ETT to develop detailed specifications about product. When they did survey, they come to know that the actual demand is higher than what they were targeting. Consumers are giving positive response. When they did second survey after 3 months of first survey, they get more positive result as 56% of the customer said that they are ready to repurchase the product again in three months. So. This brand should be launched and can consider as Euro brand.

United Cereal Lora Brill Euro challenge